A new report released by the Employee Benefit Research Institute (EBRI) found that the number of small businesses offering health coverage to their employees is shrinking, notably due to the rising cost of health care.
Using data from the Department of Health and Human Services, the report examines the rates at which employers offered health insurance to their employees between 2008 and 2015. The findings show smaller employers are particularly hard hit by this trend:
- Employers with fewer than 10 employees saw a 36% decline in coverage offered;
- Employers with 10-24 employees decreased coverage rates by 26%;
- Employers with 25-99 employees still saw a reduction in coverage offered, but comparatively by only 10%.
EBRI cited increased health care costs, among other factors, as contributing to this decline among employers.
One of the most onerous health care costs facing small businesses and hardworking Americans is the Health Insurance Tax (HIT). Indeed, due to the harmful impact of the HIT, small businesses could face an estimated $500 increase in premiums per employee each year. Because of the increase in premiums, small businesses are being forced to make tough decisions, including cutting employee benefits.
The Stop The HIT Coalition regularly hears from hardworking Americans facing these very challenges. Katie Roth, owner of Portico Staffing in Des Moines, Iowa has said, “It hits small business in a variety of ways. It impacts our ability to offer health insurance for our employees, it affects our bottom line, and it especially affects whether or not we’re going to grow as far as adding employees for our organization.”
In 2015, Congress voted to delay the impact of the HIT for one year. We applaud lawmakers for this move and ask them to provide continuing HIT relief to help America’s small businesses and the people they employ afford the health care they need.