One business group said it was “disappointed” in the U.S. Supreme Court’s ruling in the health care law, but local business opinions are mixed.
The National Federation for Independent Business, which represents hundreds of businesses in Kansas and was party to the case, said Thursday that this effectively throws the heath care law back into the political arena.
“You get the initial reaction that it’s a victory for the president and (U.S. House Minority Leader) Nancy Pelosi, but I think it re-energizes the fervor that we had in 2010,” said Dan Murray, the group’s Kansas state director. “Regardless of its constitutionality, it certainly tells people to get back to the voting booth.”
Republican presidential candidate Mitt Romney and congressional Republicans have vowed to overturn the law if they take power in the November elections.
Tim Witsman, president of the Wichita Independent Business Association, said the law will cost small businesses.
“I’ve talked to some businesses, and they tell me it could drive them under,” he said.
Mick Parrott, owner of Parrott Lawn Service, is among those who dislike the law. Because has two or three employees, it won’t affect his business much. His company is too small to fall under the mandate. He will be required to buy health insurance individually, but he already pays $1,200 a month, he said, because he’s 63 and has a chronic illness, as does his wife.
His opposition is more philosophical. He thinks it will lead to worse care for older, sicker people.
Following the ruling Thursday, he said he couldn’t wait for November.
“He (Obama) won the battle, but he didn’t win the war,” Parrott said.
Others look more favorably on the law and the court’s ruling.
David Urban, president and chief executive of Lease Finance Partners, said he offers his 10 employees health insurance and was pleased the court upheld the law.
He thinks a lot of the opposition comes from misunderstanding of what it covers, what it costs and what the alternatives are.
“That leads to ignorance and misconceptions,” he said.
Rhandalee Hinman, owner human resources consultant, Hinman and Associates, said she is sure of one thing: It means a lot of changes for her and her clients.
“Obviously we needed health care reform, although I can’t say I agree with everything in the law,” she said.
With Thursday’s ruling, businesses face the same law they did in 2010. The main provisions for business are:
• Companies with at least 50 full-time employees must provide health insurance for employees or pay a fine. The size of the penalty depends on a formula in the law.
• For smaller employers that provide at least half of their workers’ health insurance premium, the government provides a tax credit worth up to 35 percent of premium costs, rising to 50 percent in 2014.
• Companies with fewer than 50 workers are not required to provide insurance. Those workers fall under the requirement that individuals must buy health insurance, or pay a tax. According to the NFIB, roughly 96 percent of the nation’s 6 million businesses have fewer than 50 workers.
• For those workers, as well as for those business owners, the government will offer a tax credit averaging $5,000 to help offset some of the cost of individual premiums bought through the health exchanges, which are supposed to be set up in every state.
Kansas has not acted to establish such an exchange.
If the law continues to full implementation in 2014, businesses will feel the impact in several ways, say Murray and Witsman.
Small companies that offer health insurance will have an incentive to drop it because their workers can get insurance as individuals at a reasonable price, Murray said. The number of small companies offering health insurance has already fallen as costs have risen. Murray said recent statistics show that in 2000 about 50 percent of companies with fewer than 25 employees offered health insurance. By 2011 that was 33 percent.
“This will accelerate that,” he said.
Murray and Witsman said the law encourages companies to stay below 50 full-time employees.
“It has a dampening effect on employment and makes it more expensive to hire,” Witsman said.