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Will Health Insurance Exchanges Impact You?

By Cynthia Hsu, Esq. on December 19, 2011 | Last updated on March 21, 2019

Small businesses often choose health insurance policies for their employees based on the cost. Some businesses may even choose not to provide health policies because they're simply too expensive. Enter the new "health insurance exchanges," set to become fully online and operational in 2014.

Health insurance exchanges are mandated under the Patient Protection and Affordable Care Act.

Of course, the constitutionality of the healthcare reform law is still at issue. The Supreme Court is set to hear arguments next year. 

But if all goes according to the Obama Administration's plan, what should your small business expect -- and what exactly are "health insurance exchanges"?

  • Health insurance exchanges are state-run. The term isn't too descriptive, but health insurance exchanges are essentially state-wide marketplaces where individuals and small businesses can shop and purchase health insurance coverage.
  • It's possible the exchanges will result in lower costs. One of the goals of the health insurance exchanges is to foster transparency, and hopefully lower costs of insurance for individuals and businesses.
  • Businesses still won't be mandated to provide insurance to employees. Remember, if the healthcare law is passed, individuals, not businesses, will be mandated to purchase coverage. But businesses could face fines in 2014 if they employ 50 or more workers and fail to provide coverage to those who work 30 or more hours a week.
  • There may be tax credits you can use. Certain firms will qualify for tax credits of up to 50% of their contribution if they provide health insurance. These tax credits, however, are mostly temporary. The specific amount you can claim will depend on how many employees you have, and their average salary, according to The Wall Street Journal.

The creation of health insurance exchanges to come 2014 will likely have an impact on small businesses. Recent surveys have even indicated that some employers are receptive to the idea of purchasing coverage through small business exchanges. Where do you stand on the issue?

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