A look at the perks and penalties in the new health care bill for small-business owners
By APWednesday, March 31, 2010
Health care perks, penalties for small businesses
Some highlights of the health care law for small businesses:
PENALTIES — Companies aren’t required to offer insurance but face an annual $2,000-per-employee fee if the government ends up subsidizing workers’ coverage. Companies with fewer than 50 employees are exempt.
TAX CREDIT: Employers with 25 or fewer workers with average annual wages of less than $50,000 are eligible for tax credits starting in 2010. The credits rise in 2014 to a maximum of 50 percent of the cost of premiums offered by businesses with 10 or fewer workers. Democrats say 3.6 million small businesses could benefit.
INSURANCE EXCHANGES: States must create them by 2014. Businesses with up to 100 employees can pool employees to help their negotiating clout with insurers. Senate Democrats say administrative costs could be cut up to 22 percent for 29 million businesses.
SELF-EMPLOYED: The 22 million who are self-employed will be able to use the exchanges to ease the cost of premiums up to 30 percent, according to estimates.
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Source: U.S. Senate Small Business Committee
