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Seminar explains options for small businesses
YOUNGSTOWN
Local small-business owners learned about their health care options as the Affordable Care Act continues to be implemented.
U.S. Sen. Sherrod Brown’s office hosted a health care seminar Monday morning at Williamson College of Business Administration at Youngstown State University.
Representatives from the U.S. Small Business Administration presented the options that small-business owners have through the Small Business Health Options — or SHOP — marketplace, which is separate from the individual marketplace.
Some small-business owners expressed concern over the health care law.
“My biggest concern is I still don’t understand how this helps the lower-income employee,” said Jimmy Sutman, president of Iron and String Life Enhancement Inc., which provides services for mentally disabled people.
Sutman has a total of 320 employees with 85 of them full time. Some of them work a second job, he said. “It’s unnerving,” he said.
The ACA does not require businesses with fewer than 50 full-time equivalent employees (who work a minimum 30 hours) to offer health insurance. A full-time equivalent is a combination of part-time employees that equals up to full-time.
SHOP, however, is designed to make health care more accessible and affordable for small-business owners, said Jim Donato, SBA’s Cleveland deputy district director.
Additionally, owners could qualify for a tax credit if they apply for coverage through SHOP. The Small Business Health Care tax credit allows employers with 24 or fewer full-time equivalent employees that pay average annual wages of less than $50,000, and contribute 50 percent or more toward employees’ self-only premium costs, to receive a tax credit of up to 50 percent, or 35 percent for tax-exempt employers. The maximum tax credit is available for employers with 10 or fewer full-time employees with an average wage of less than $25,000.
For employers with up to 50 employees, SHOP offers a choice of health and dental plans. Unlike the individual marketplace where the deadline is Feb. 15, SHOP is available year-round. Employers are required to have a 70 percent participation rate to enroll in coverage from SHOP. Employers, however, can enroll between Nov. 15 and Dec. 15 without meeting the minimum-participation requirement, Donato said.
Furthermore, Ohio is among the 14 states that allow employers to offer employees a choice of plans.
On the other hand, employers with 50 or more employees are required to offer coverage or face a penalty. Those employers are required to offer coverage to 95 percent of its full-time employees and their dependents. The offered plan also must cover at least 60 percent of the plan’s total cost of incurred benefits.
There is some relief this year, Donato said. Employers with 50 to 99 full-time equivalent employees will not be penalized if they do not offer insurance. Employers also will not be penalized if they offered coverage to only 70 percent of its employees.
Small businesses don’t have to go through SHOP, but can get health insurance through traditional brokers, said Gil Goldberg of the SBA’s Cleveland district.
Some brokers attended the seminar, including John Morvay, owner of Morvay Insurance Group in Canfield. He said the SHOP plans appear slightly more expensive than the prices employers would get through a broker, but that’s not counting the tax credits.
Additionally, the ACA keeps changing.
“When you do get it learned, they change it,” he said. “We’re just trying to do the best we can to advise our clients.”
SHOP has been available since 2013 through a paper process, but switched its access online in November, Donato said.
The Cleveland office has done similar seminars in Cleveland and Toledo. Youngstown was the third stop. “We just want to get the word out,” he said.