Minding Ag's Business

D-Day for Health Exchanges

Online health care exchanges are supposed to open for business tomorrow, barring a last-minute intervention from Congress. Your new best friend in navigating these changes for yourself, your family and your employees will be a qualified CPA firm. Large accounting firms have devoted armies of experts to analyze the rules and get up to speed on what business owners will need to do for compliance. Some have also developed their own calculator programs to assess whether you are better off continuing coverage with a private small group plan, buying similar coverage in the new statewide SHOP markets for small business or discontinuing coverage and buying coverage as individuals in the state marketplace.

I wish I could say this will make health care coverage less complicated, but any change this massive will involve some bumps at launch. Since mandates for personal coverage don’t start until 2014, you'll have plenty of time to weigh your options and still let online markets for individuals and small business SHOP plans work out the kinks.

I know from my last post that many of you are skeptical. Before you get bogged down in details, remember small business owners have more to gain than lose in this health care, says Rhett Buttle, a vice president for Small Business Majority, an advocacy group representing 300,000 small businesses. He and DTN Tax Columnist Andy Biebl will address the topic at the DTN-Progressive Farmer Ag Summit in Chicago Dec. 9-11.

Employers with one to nine employees pay 18% more for health insurance than their Big Business counterparts and one out of four sole proprietors have no insurance coverage for themselves largely due to costs or pre-existing medical conditions . Some have elected high deductible plans that essentially only cover catastrophic and emergency health care, not routine or maintenance.

"When one Costco employee gets sick, it doesn't ruin your health care plan. When one person in a group of 10 gets sick, you don't only worry about them, you worry if your insurer will jack up your premium rates," Buttle says.

Buttle's small business organization believes individual marketplaces and the state's small business group markets (SHOPS) will offer better and less expensive coverage than many small plans do now. In fact, overall rates could be about 8% less than what small business owners pay on average now, it says. That doesn't count the 50% tax credit available to small business owners who buy employee coverage on the exchange next year.

Individuals may find similar deals. Your rates and insurance offerings will vary by where you live, your age and other factors, but the Kaiser Family Foundation was pleasantly surprised by how competitively priced unsubsidized rates were in the 36 individual exchanges run by the federal government and another 14 state-run markets. Most rates ran under $400/mo. for those under 55. For a sample of individual "silver" plans with $1,500 deductibles and a maximum of $6,350 deductibles, go to http://www.kaiserhealthnews.org/….

Keep in mind, these rates don't include tax credits which could shave an average of $2,750 off premiums for moderate- to low-income individuals.

Jarek Steele, who owns a chain of small book stores in the St. Louis area, crystallizes the issue in terms farmers can appreciate. He pays 100% of the insurance cost for his 12 full-time employees as a way to attract and keep talented workers, but he's had to raise deductibles to $5,000 apiece to keep premiums affordable. Even so, that's $270,550 over the past five years--or the entire profit from selling 40,050 paperbacks--just to pay the fringe benefit. He expects to qualify for premiums on the exchange closer to $220 per month--saving $195 per month--once they open for business.

"I'm excited we can offer insurance that doesn't punish us," he says.

For a small business primer on the Affordable Care Act and more information on the SHOP marketplaces, go to Small Business Majority's http://healthcoverageguide.org/…

Let me know what you find out navigating the insurance exchanges.

Follow Marcia Taylor on Twitter@MarciaZTaylor.


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George Hanson
10/14/2013 | 6:58 AM CDT
More obamacare news at http://spectator.org/archives/2013/10/14/obamacare-and-the-edsel-a-tale
Bonnie Dukowitz
10/4/2013 | 7:58 PM CDT
How unfortunate for the Red River Valley family. We can all relate to similar disasters at or very close to home. The health care issue is just not in any way comparable to what our and other family members lived and died for on D-Day. If you recall, some of the biggest issues causing problems in agriculture in the 70's and 80's were caused from government flubs. Recovering from the grain embargo, the missery index(inflation rate+interest rate) of Tip O'neals spendaholism. There were many farmers went under without medical disasters. All of the money in the world will not save the young man nor all of the family farms. It is unfortunate, but that is the way it is. One should look up the definition of "Hero".
Alvin Obert
10/4/2013 | 1:00 PM CDT
To think an inept government spending trillions on health care will lower health care costs is absurd. Government cannot manage current spending judging by the trillions Obama has exploded the debt and deficits.
Don Thompson
10/4/2013 | 7:01 AM CDT
Marcia. I support health care reform for similar reasons. My neighbor was the sharpest hard working individual I knew. He and his wife's health issues produced an insurance premium of $35000 per year back in the 80's. They made it with some state help by getting the premium down to $21K. Not right in this country.
Marcia Taylor
10/3/2013 | 9:52 AM CDT
When I write about these financial subjects, I keep real people in mind and try not to side with any party. One of my heros is a Red River Valley wheat farmer whose 16-year-old son died from a brain tumor in the mid-1980s. It was the worst of times for US farmers, but Melvin decided to pay all his hospital bills rather than declare bankruptcy. When a devastating wheat disease later hit the Valley, he was tapped out and had to sell out. He retired penniless after a lifetime of sweat and labor, leaving a widow with virtually nothing. I don't care which party created the law that puts erased the lifetime limit on health expenses, or is trying to make insurance more affordable. I'm just hoping small business owners with medical issues can retire with some dignity and something to show for their sacrifices.
Bonnie Dukowitz
10/2/2013 | 7:47 PM CDT
Sorry Marcia, I like reading. However the D-Day description is just not acceptable. It was the likes of my relatives and many, many others, who were actually there and some of us who just tried to understand what they went through that insured our freedom. If some of you had ever listened to our true Hero's opening up, not todays liberal and lax description of hero, the title of the article just would not be acceptable. The government welfare of healthcare is just not, in any way, comparable to what our Veterans went through. If some of these whiners ever had to pick up their buddies arm or leg on a beach and try to put it back on, they might have a valid reason to complain about health care.
Alvin Obert
10/2/2013 | 1:11 PM CDT
Try checking out those links again Don. The Teamsters and AFL-CIO certainly did not fight obamacare originally. The longer obamacare is in effect the fewer Americans will have full time jobs. Part time jobs do not pay the bills.
Don Thompson
10/2/2013 | 11:37 AM CDT
I assume all the "anti" crowd does not have a preexisting condition. Good for you. All your links refer to organizations that have fought not only healthcare but all social programs from their inception. They will continue until all but their supporters are totally without. Nice crowd. See you in church.
Alvin Obert
10/2/2013 | 11:25 AM CDT
Before you do any more cheer leading for obamacare Marcia check this out - http://www.nationalreview.com/node/359861/print
Alvin Obert
10/2/2013 | 7:16 AM CDT
The democrats sure know how to choose the corrupt to manage our personal information. See http://spectator.org/blog/2013/10/01/obamas-acorn-pals-cashing-in-o
Al Thomas
10/2/2013 | 7:07 AM CDT
Obamacare Overcharging Fraud Like three peas in a pod. See http://dailycaller.com/2013/09/30/company-with-1-2-billion-obamacare-contract-under-investigation-for-serious-fraud/ And there are naive people who actually believe obama could lower health care costs.
Brandon Butler
10/1/2013 | 3:23 PM CDT
It is amazing that the people/organizations in this article that think this is such a great idea don't realize that there is no free lunch. How do you think it will be paid for? HIGHER TAXES AND/OR A REDUCTION IN QUALITY/QUANITY OF SERVICES, YOU DOLTS.
Jim Swanson
10/1/2013 | 7:52 AM CDT
Democrats in congress needed a special exemption from obamacare since they are so special. See http://www.nationalreview.com/article/358550/congresss-exemption-obamacare-john-fund
Vince Moye
10/1/2013 | 5:55 AM CDT
Thanks for the clear factual unbiased info Marcia. ☺