Setting up state health insurance exchanges is good for small business

Yesterday the Supreme Court turned back a baseless, politically motivated challenge to the Affordable Care Act. In doing so they demonstrated the judicial independence all Americans expect of our highest court.

Now the hard work of implementing the ACA begins in earnest. Putting in place state-based health insurance exchanges is right at the top of the to-do list. That means in New Jersey Governor Christie should sign the exchange legislation he recently vetoed.

Health insurance exchanges will, if properly designed and managed, be a boon to individual purchasers and small businesses. By creating a market place that offers quality insurance programs and negotiating the cost of premiums through risk pooling, for the first time small businesses like mine will have the purchasing power of large corporations. Those are the kinds of provisions included in New Jersey’s current exchange legislation —legislation Governor Christie could sign tomorrow and should sign, if he is serious about helping small businesses.

The only beneficiaries of stalling or reversing the ACA are the free-riders that currently enjoy “free” health care at the expense of those who are currently paying into the system. If, as Senator McConnell and Speaker Boehner have indicated, they are intent on further obstruction, they have clearly not gotten the message. They should stand aside and let the rest of us get on with making the ACA work for the American people.

Increasingly small-business owners are realizing the ACA’s direct benefits — benefits that improve the bottom lines of legitimate small businesses that are committed to their customers, their employees and their communities.

The Medical Loss Ratio (MLR) 80/20 value means 80% of premiums must go to providing health care. This rule alone has put downward pressure on premium costs, and recently a future $1 billion refund was announced for insurance purchasers that have in the past been overcharged. When extending family coverage to young adults, the end of lifetime limits and pre-existing condition denials are added, it is easy to see why small-business owners support the ACA.

The carrots in this legislation, especially for middle-class purchasers and small businesses, are designed to encourage voluntary participation. The sticks are more like reminders than real penalties.

Direct subsidies and tax breaks for low- and middle-income purchasers and small businesses will make it possible for millions of these consumers to enjoy the security of coverage for the first time. And that in turn will improve the cost of purchasing insurance for companies like mine that derive no direct assistance.

The more people know and understand about the ACA, the more they will support it and take advantage of its benefits.

James Conklin is the owner of Foley Waite Associates Inc., a small architectural woodworking firm in Bloomfield, N.J., and a member of the New Jersey Main Street Alliance.