House Committee Discusses Self-Insurance OptionNovember 20, 2013
On Thursday, Nov. 14, 2013 the House Small Business Subcommittee on Health and Technology held a hearing on the potential benefits for small businesses that self-insure. The hearing, “Self-Insurance and Health Benefits: An Affordable Option for Small Business?” provided insight into how and why small businesses would and/or should chose to self-insure. Companies that self-insure basically fund employee claims directly—cutting out the “middle-man”—rather than paying a premium to insurers to pay those claims on their behalf.
Subcommittee Chair Chris Collins (R-N.Y.) underscored the potential savings for small businesses that self-insure citing the fact that self-insured plans are exempt from some of the most costly provisions under the Patient Protection and Affordable Care Act (PPACA). Collins stated that, “The burdens of the law are causing many companies to look for ways to remain viable.”
Self-insured plans have typically been options used primarily by larger employers, but with the impending health care changes per PPACA, and the fact that many of those changes are not applicable to self-insured plans, more and more small businesses are likely to explore this option.
Amidst the ongoing problems with the roll-out of the PPACA, there exists continued uncertainty and anxiety among small businesses of how the law will impact them. According to data from NSBA’s 2013 Mid-Year Economic Report, 81 percent of small businesses have limited or no understanding of how the law will impact their business and one-third of the smallest firms (fewer than 50 employees) still have no idea how they will comply with the new law.
Responding to growing concerns from small business about the complexity and increasing costs, NSBA last week launched a new self-insured health insurance offering. Partnering with The Association Benefits Solution (TABS), NSBA’s new plan, the NSBA-TABS Health Plan, could provide key savings to eligible NSBA members. Moreover, the structure of the NSBA-TABS arrangement dramatically reduces the potential risk for small business that choose to self-insure.
The program kicked off a series of webinar yesterday, Nov. 19, which provides small businesses with the latest updates on where PPACA stands as well as the potential benefits under the NSBA-TABS Health Plan.
Certainly, self-insurance or the NSBA-TABS Health Plan may not be a perfect fit for every small business: eligible firms will have at least 10 employees and must be a member of NSBA. And those firms with low health insurance claims will reap the most benefits.
To learn more about the NSBA-TABS Health Plan or to get on the waiting list for our upcoming webinar, please CLICK HERE.
NSBA is in the midst of conducting a detailed survey on health care and small business. Please click here to tell us how health care costs are impacting your business.