Supreme Court strikes down ACA (Affordable Care Act) — what effect does this have on small business?

Posted by Employer Flexible on January 18, 2019
Employer Flexible

After years of talk and speculation, District Judge Reed O’Connor of Texas may have just struck down the Affordable Care Act (ACA) with a single decision. As a small-business owner, you are undoubtedly wondering how this will impact your company and its bottom line as a result. With the potential for appeals and delays in applying the ruling if it sticks, there is nothing to worry about quite yet. To prepare for any upcoming changes, however, it makes sense to explore this ruling and its potential impacts on small businesses.

Latest Supreme Court Ruling on ACA

In Texas v. The United States, the plaintiffs claimed that the ACA is now unconstitutional with the elimination of the individual mandate penalty, set to start in 2019. By removing this penalty, the ACA requirements no longer receive protections for being a part of the taxing power of Congress. At the end of 2018, District Judge O’Connor expressed his agreement with this claim by ruling in favor of the plaintiffs. This ruling may have eliminated the protections given by the United States Supreme Court in National Federal of Independent Businesses (NFIB) v. Sebelius, but it is too early to tell for sure quite yet.

Potential for Future Appeals

The ruling by District Judge O’Connor will likely face appeals in the near future by California Attorney General Xavier Becerra and other concerned individuals. The appeals process will need to go through the federal appeals court in Texas before having a chance to appear before the U.S. Supreme Court. If the state appeals court does not reverse the ruling, it is expected that the U.S. Supreme Court will rule against it as they have with the other ACA repeal attempts. If this ruling is upheld, however, and the ACA is actually eliminated, there could be major repercussions on you as a small-business owner.

Current and Future Impact on Small Businesses

With about 60 percent of small-business owners in support of the repeal of the ACA and the rest against, there will be a big divide in regard to perceived impacts of the repeal. In areas where insurance companies are leaving the marketplace, there is a large problem with constantly increasing monthly insurance premiums, making ACA coverage more of a burden than anything else. As the cost of these plans spirals out of control, small-business owners look for better options and hope for a repeal of the ACA and its limitations.

The remaining 40 percent of business owners are perfectly happy with the ACA and their insurance coverage. In fact, many in this group were able to upgrade their coverage levels and decrease premiums over their prior plans, thanks to the ACA. Therefore, each small business will experience positive or negative impacts from the repeal of the ACA, depending on their current satisfaction levels with their coverage.

If you were able to acquire affordable insurance coverage through the ACA marketplace, for example, you may find a repeal without replacement of coverage problematic for your company and employees. On the other hand, if you suffered rate hikes, coverage loss and other problems with the implementation of the ACA, you may be open to seeing how the changes could open up the door to better benefits.

Securing the Best Benefits Packages for Your Small Business

Only time will show how this decision will play out and its overall effect on the health of small businesses across the nation. You can protect your small business from experiencing strife during the changes that may occur by partnering with an experienced professional employer organization. At Employer Flexible, we specialize in providing effective HR and recruitment solutions. Give us a call at 1-866-501-4942 to learn how we can help you find and acquire the best benefits for your company.

Topics: Affordable Care Act