The Small Business Dilemma: How Rising Health Care Costs are Tough on Small Business

When it comes to health care, American small business owners are getting a raw deal. 

While the current insurance marketplace offers some options to larger employers, it too often leaves small business owners on the outside looking in. They face unpredictable changes in costs, and far too often they are forced to choose between covering employees and the very survival of their businesses.

One crucial test of any health reform proposal is whether it offers a better deal to American small businesses. But the key Washington lobbies who claim to represent small businesses have been historically aligned with the political interests most opposed to reform.

To more accurately reflect the diversity of views of small businesses on health care, the U.S. Public Interest Research Group has let small business owners to speak for themselves. Three hundred and forty-three small business owners and managers across the country made their views heard through a survey which investigated the impact of health care costs on their businesses.

Survey Results:

Our efforts revealed that small businesses who do not currently offer coverage would overwhelmingly like to, but are stymied by high costs, complications and red tape. 

We discovered that those entrepreneurs who do make the sacrifices necessary to provide health care consider it less a moral obligation than a smart business strategy to increase employee productivity and attract and retain talented employees.

Finally, we discovered that only a fraction of small business owners surveyed believed that their voices were being heard in the current health care debate.

* 78% of small businesses who do not offer coverage would like to do so.

* 80% of those owners who would like to offer coverage cite cost as a barrier

* 17% of those owners who would like to offer coverage say that they do not offer  coverage because it is too complicated

* 55% of small businesses offering coverage do so to attract and retain good employees

* 27% of small businesses offering coverage do so to increase worker productivity

* Only 24% of owners surveyed felt that their interests were represented in the current health reform debate

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ConnPIRG Education Fund is part of The Public Interest Network, which operates and supports organizations committed to a shared vision of a better world and a strategic approach to social change.