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STUDY: Health Care Reform Helps Small Businesses

By Tara Culp-Ressler on September 11, 2012 at 4:55 pm

"STUDY: Health Care Reform Helps Small Businesses"

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Opponents of President Obama’s health care reform law often justify their position by claiming Obamacare will hurt small businesses. But research on the subject in Massachusetts — where the health care reform that Mitt Romney enacted during his time as governor provides a test case for national health reform policy, thanks to its similarities to Obamacare — disproves this conservative talking point.

Economic researchers on a recent Georgetown University panel all agreed that Massachusetts’ small business owners were actually bolstered by health care reform, as the number of small businesses offering health care to their employees increased from 70 percent to 77 percent in the time since Romney enacted the reform in 2006. Linda Blumberg, an economist and senior fellow at the Urban Institute, said her organization’s research confirmed that small business owners are not struggling to afford the insurance plans that the health reform law requires them to provide for their employees:

“Our research demonstrated very clearly that there is no evidence that the reforms have had any negative impact on employment at all,” Blumberg said. Her organization studied specifically some industries that might feel a greater impact under the law—small employers or the retail and restaurant industries, which often don’t offer health insurance—and concluded the same. “In none of these sectors did we see reduced employment,” Blumberg said.

In fact, said Jack Connors Jr., a founding partner at Hill, Holliday, Connors, Cosmopulos, Inc., a Boston marketing firm, one of the largest in the United States, businesses could see a benefit when health insurance is “accepted as part of the compensation package for employees.”

“Many business leaders would say we have a competitive advantage,” Connors said.

Just like Obamacare, Romney’s health reform in Massachusetts is predicated on an individual mandate that requires employers to provide adequate health insurance coverage to their employees or risk paying a penalty. Although Republican lawmakers have decried Obamacare for strangling small business owners and middle-class workers, and have wasted about 89 hours and $51 million dollars in their attempts to repeal the law, the evidence from Romney’s home state suggests their efforts are doing little to protect small business interests.

Blumberg explained that her research on the economic effects of health care reform has left her confused about why Obamacare remains so politically contentious. “This was very much a compromise between liberal sensibilities and business sensibilities,” she explained. “So the entire perception of the federal law has been shocking to me, because this was really laid out as a moderate approach.”

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