Despite the current administration’s efforts to repeal the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) in 2017 and its continued efforts to undermine the law’s progress, the individual marketplaces and the expansion of Medicaid have resulted in more entrepreneurs, small-business owners, and employees accessing more affordable and comprehensive health insurance coverage than before the ACA was implemented, according to an October 2018 report from The Commonwealth Fund. The report noted that currently, more than 5.7 million small-business employees or self-employed workers are enrolled in the ACA marketplaces and more than half of all ACA marketplace enrollees are small-business owners, self-employed individuals, or small-business employees. New rules that allow more groups to establish association health plans and extend the length of short-term health insurance plans, however, are likely to impact the stability of the marketplaces and coverage rates for the small-business community.
The analysis. The Commonwealth Fund conducted an analysis of ACA small-business enrollment data from established sources, including federal agencies and nonpartisan health care research foundations, supplemented by analysis of U.S. Census data. Prior to the ACA, small businesses and their employees comprised a disproportionate share of the working uninsured. In 2011, six of 10 of the nation’s uninsured workers were self-employed or working at companies with fewer than 100 employees. As a result of access to ACA marketplaces and the expansion of Medicaid in many states, recent analyses indicate significant gains in coverage for small-business owners, the self-employed, and small-business employees.
Access to health care after the ACA. The report stated that as a result of market regulations, ACA marketplaces, and subsidies the uninsured rate for small-business employees fell by almost 10 percent post-ACA.
- Small business employees. In 2013, uninsured small business employees accounted for 40 percent of all uninsured workers in the U.S. Of the 36.3 million nonelderly adults in the United States working for a business with fewer than 50 employees, 28.1 percent were uninsured. In 2016, there were 36.1 million people working at a business with fewer than 50 employees, of those, 19.4 percent were uninsured.
- Self-employed entrepreneurs. In 2013, 29 percent of self-employed adults were uninsured; as of 2016, the uninsured rate fell to 19.2 percent. Almost 12 percent of these individuals found coverage through Medicaid and addition coverage came from marketplace enrollment.
In addition, following the ACA’s implementation, health insurance costs for many small businesses have declined due to small-business premium increases falling by half. According to the report, the increase in small business health care premiums has been at the lowest level in years, following regular double-digit increases prior to the ACA’s enactment.
Impact of Medicaid expansion. Medicaid expansion has directly benefitted small-business owners and their employees, the report concluded. The Center on Budget and Policy Priorities estimates that 1.7 million small-business employees gained coverage through the expansion of Medicaid by 2015. Between 2013 and 2016, there was roughly a 50 percent increase in the number of small business employees enrolled in Medicaid. The rate of self-employed individuals covered through Medicaid rose from 7.3 percent to 11.6 percent between 2013 and 2016, while rate of small-business employees covered by Medicaid rose from 9.1 percent to 13.4 percent over the same time period. Between 2013 and 2017, Medicaid expansion states experienced a 9 percent decline in uninsured rates as compared to the 3.7 decline in uninsured rates in states that did not expand Medicaid.
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