The Employer Mandate : Analyzing Market Reforms Through the Affordable Care Act in the Small Business Industry

Abstract

The market for health insurance in the United States was transformed with the passage of the Patients Protection and Affordable Care Act (PPACA) in 2010. The principal objective of the Affordable Care Act was to expand coverage options to those who previously would not have been able to afford it. One method to achieve this goal is by expanding the system of Employer-Sponsored Insurance (ESI). However, Employer-Sponsored Insurance has not been proven to be truly beneficial, especially within the small business industry. While there are advantages exclusive to small firms, such as tax incentives and exemptions, the system has not definitively been proven to be beneficial. Initiatives such as the Small Business Health Options Program (SHOP) have developed to provide small firms with better options within the marketplace for healthcare coverage. Therefore, this project analyzes whether or not it is in the best interest for a small firm to offer employer-based health insurance for its employees. The research will focus on controlling rising premium rates, providing increased access to doctors, reforming federal programs and analyzing risk pools among low and high-wage firms.