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Employer-centered health insurance is hurting small businesses

We can continue to bail out and save the failing private market, or we can face the reality that we need to create more public options.

doctor's office
REUTERS/Mike Blake
With the latest legal ruling in the lawsuit against the Affordable Care Act, we’re seeing continued confusion and chaos in the health care system. As a small business owner, I find it harder than ever to be competitive in employee recruitment.

I am a third-generation small-business owner. My mother grew up working in a family hardware store, my dad worked in his father’s drugstore, and I grew up working in the family drugstore in Benson. When I founded Perennial Cycle, I knew the importance of family-owned business values.

I have been in business for 25 years and have seven year-round employees with an additional nine summer seasonal employees. One of my biggest challenges, and one of the biggest challenges for small-business owners across America, is the inability of my business to afford health care for my employees. Health care costs are the No. 1 issue for small-business owners, according to recent polls. My wife and I are challenged in a big way to pay for health insurance for our own family, let alone for our staff. We want to provide it, but costs are so prohibitive, it’s just not an option. When the Affordable Care Act opened plans on the exchanges, it provided at least a minimum of coverage for employees, many of whom were uninsured otherwise.

Few accessible, affordable plans

Our employees need to be able to find health care options, good plans that are both affordable and useful, but there are very few plans on the private market that are accessible and don’t have high deductibles. We are all becoming very familiar with the clear difference between health “coverage” and actual health CARE.

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What helps my employees helps me. That’s why as a small-business owner, I absolutely support publicly funded health care and a buy-in option. With the latest legal attacks against the ACA, we are moving further and further from a health care system that supports the main street economy.

Luke Breen
Luke Breen
This isn’t just philosophical or moral support, it is a financial issue for my business. Turnover costs are so high, and we need to be able to retain employees. We do whatever we can to create a stress-free and healthy work environment, but we often lose people to larger companies that have the scale to provide health care. And still, employer health insurance is increasingly unaffordable even at the largest firms.

For small businesses, our ability to complete in our own markets is dictated by outside industries: health insurance markets. My best employee recently left to take another job, because she turned 27 and was no longer eligible to be on her parents’ health insurance. She didn’t want to leave, but she needed employer-funded health care, so she truly had no choice. And without the changes from the Affordable Care Act, she would have had to make that employment decision much sooner.

A better path

The private market is failing us. I feel strongly that the government is responsible for making health care work for everyone. We can continue to bail out and save the failing private market, or we can face the reality that we need to create more public options. The pathway for my employees to get simple, affordable, and reliable health care is not through the private market, but through options like Minnesota’s ONEcare and taking action to rein in drug companies and bring down the cost of health care.

The ACA was one step, but health care is still crippling for small businesses. We can’t go backwards; what’s at stake are my bottom line and my employees. It’s time to solidify the gains from the ACA, like protecting the 130 million of those with pre-existing conditions, and move toward a public option. It’s time to level the playing field for small businesses. Let’s us compete on our products and services, not our ability to offer benefits.

Luke Breen is the owner of Perennial Cycle in Minneapolis and member of the Main Street Alliance.

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