Although the ink is barely dry on the health care reform law intended to help all Americans afford health insurance, the Los Angeles Times reports that small businesses in California are starting to see their health insurance costs rise, making a full economic recovery in the state even less likely.
This is because a handful of major insurers in California are planning 12-23% percent rate hikes in health insurance costs for businesses with fewer than 50 employees — and it isn’t just happening in the Golden State. Florida, Ohio, and Texas small businesses are experiencing similar cost crunches because of high health care and drug costs.
One business owner quoted in the LA Times saw her yearly insurance bill go from $11,000 to $19,000, and another small business is ready to “hang it up” because of rising health care costs and low product demand.
Of course, increased health care costs for employees is bad for small businesses and can potentially lead to more widespread problems in the national economy; in order to help curb expenses, small business owners in California could choose to slow down on hiring and plans of expansion — or even leave the state all together.
Moreover, fledgling entrepreneurs may not be nearly as excited to get their ideas into the marketplace if they know the kind of health care costs that await them.
Has the cost of health insurance for employees been a driving factor in your small business decisions? Are you experiencing similar rate hikes in your state? If so, please share where and by which company or companies.
You might also be interested in the following LegalZoom articles and information:
- Insuring Your Business: 5 Questions to Ask About Business Insurance
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- Top 5 Health Insurance Tips for the Self-Employed
- eHealthInsurance via LegalZoom’s Small Business Network