Archive for April 2012

377 Million reasons for small business to like Obamacare

Here’s an interesting article founder Ben Kyriagis ran across from a similar group in South Carolina. I encourage members to visit the site and see where we might be in a few years. Reprinted here with permission.



One of the provisions of the Affordable Care Act–Obamacare–is the requirement that 80% to 85% of health insurance premiums go toward actual medical costs and not to overhead and profit of the insurers.  Otherwise the policy holder is due a refund at the end of the year.
This medical loss ratio went into effect in 2011.  Now we our learning exactly how beneficial this part of Obamacare is for the American public.
The Kaiser Family Foundation has estimated that small businesses are due about $377 million in health insurance rebates thanks to President Obama’s healthcare reform.  Big business should receive about $541 in rebates and individuals about $426 million.
This is the second Obamacare provision that is making health insurance more affordable for small business.  Since the reform was signed into law in 2010, hundreds of thousands of qualifying small businesses have been receiving federal tax credits for offering health insurance as an employee benefit. 
And there is more good news on the healthcare front.  According to the Centers for Medicaid and Medicare Services health care spending nationally is experiencing its slowest rate of increase (4% a year) in 50 years.
Controlling health care costs was something that most of us felt that Obamacare did not sufficiently address.  And while the Great Recession has played a role in restraining healthcare spending over the last few years, experts agree that the economy doesn’t deserve all the credit for bending the healthcare cost curve.
Here are some of the other explanations offered by health economists.
–many insurers and health systems are moving to accountable care that rewards quality of care not quantity, focusing on patient follow-up to insure physician instructions and medication regiments are being kept in order to prevent expensive visits to the hospital.
–there has been an increase in high-deductible health plans that require people to pay more out of their pockets for healthcare costs before insurance benefits kick in resulting in people opting not to seek medical attention, even vaccinations (i.e. self-imposed healthcare rationing).
–a lack of expensive new drugs hitting the market and more emphasis on using generics is holding back increases in pharmaceutical costs—a  major healthcare spending driver.
–efforts to reduce medical errors that result in expensive and needless healthcare services are working.
But in addition to all these contributing tangible factors is the meaningful, if hard to measure, effect of the country’s attention being focused on the need for healthcare reform.
According to Mark McClellan, President George W. Bush’s Medicare and Medicaid director, past slowdowns in healthcare spending “have occurred not just because of the direct effect of reforms, but because of greater attention to reforms changing provider and patient behavior.”
When we all are talking about a problem and what to do about it, that alone can change our behavior.  Patients are a little more willing to take care of themselves and be more thoughtful in the medical services they seek.  Doctors and hospitals are a little more aware of the cost of procedures and best practices.  And insurers are a little more demanding on healthcare providers and a little less on raising premiums.
And there has certainly been no one who has directed the public’s attention to the healthcare crisis and reforms than President Obama.  For that alone he deserves enormous credit.
( Posted on Unconflicted 30 Apr 2012)
UnConflicted is the small business advocacy blog of Frank Knapp, Jr., President & CEO of the South Carolina Small Business Chamber of Commerce. Visit our website to join, subscribe to our newsletter, or follow the issues affecting small businesses in SC:

Small Business Leaders Urge Senate to Pass Buffet Rule

Majority of Small Businesses Not Affected by Rule, Want End to Tax Cuts for Highest Incomes


Washington, DC – Today, the American Sustainable Business Council (ASBC), Business for Shared Prosperity (BSP) and Main Street Alliance (MSA) called on the Senate to legislate a “Buffett Rule” by passing the Paying a Fair Share Act (S. 2059), assuring that households with incomes above $1 million don’t pay lower tax rates than middle-income taxpayers.

In a letter delivered to Senators, nine business organizations disputed claims that a Buffett Rule would negatively affect small businesses owners, the vast majority of whom are middle-class Americans with incomes under the rule’s $1 million threshold. Only 1 percent of the 34 million households reporting any business income on their tax returns earn more than $1 million annually, according to data from the non-partisan Tax Policy Center.

“I could have all the South Carolina small business owners making more than $1 million a year over for a backyard barbecue and have plenty of room left over,” said Frank Knapp, president of the South Carolina Small Business Chamber of Commerce and vice chair of ASBC. “It’s time for the real millionaires club – CEOs of big corporations, hedge fund managers and corporate lobbyists – to pay their fair share.”

“When politicians who stand against a Buffett Rule for millionaires wring their hands about how it will impact small businesses, let’s be clear: that’s small business identity theft,” said Benjamin Markeson, owner of Three Star Flea Market in Apopka, Florida, and a leader with MSA. “They’re stealing the good name of small business owners like me, who believe millionaires aren’t paying their fair share of taxes, and using us as a human shield to protect the richest one percent from pitching in.”

The letter also cited national, independent polling data showing that 57 percent of small business owners support the tax increase included in the Buffett Rule. The scientific poll revealed that only one of the 500 small business owners surveyed reported an income above $1 million.

“Those who benefit most from our national expenditures on infrastructure, education and law enforcement need to pay their fair share,” said Lew Prince, owner of Vintage Vinyl in St. Louis, Missouri, and a BSP leader. “I’ve been in business 33 years, and I’m appalled that my customers, who worry about scraping up enough to pay for their next tank of gas and groceries, pay higher tax rates than some oil and food executives. The Buffett Rule is the right step in bringing more fairness to the tax system and supporting the public investments and job creation we need for a healthy economy.”

Business leaders have been pushing Congress to restore higher tax rates for high-income Americans since 2010. ASBC, BSP and MSA have signed a petition with hundreds of small business owners to let the high-end tax cuts from the George W. Bush presidency expire at the end of 2012. BSP also released a 2011 report detailing the business benefits of fair income taxes and setting the record straight about the impact of top-rate tax cuts on small businesses.

The Senate is scheduled to vote on the Paying a Fair Share Act, introduced by Senator Sheldon Whitehouse (D-RI), on April 16.  Following the delivery of the business leaders’ letter, Sen. Whitehouse said small business owners “work hard every day, play by the rules, and pay their fair share in taxes. It’s not right for ultra-high income earners to play by different rules and pay lower tax rates, and I’m committed to correcting this inequity.”


The American Sustainable Business Council is a growing coalition of business networks representing over 100,000 companies and 200,000 business leaders. ASBC advocates for public policies that meet the realities of the 21st century global economy. (SBM IS A MEMBER)

Business for Shared Prosperity is a network of forward thinking business owners, executives and investors. BSP has organized petitions for positive corporate tax reform and for ending top-rate tax cuts, and produced related reports. BSP is a member of the American Sustainable Business Council.

The Main Street Alliance is a national network of state-based small business coalitions. MSA creates opportunities for small business owners to speak for themselves on issues that impact their businesses and local economies.

Small Business Video and Audio Presentations -Online!

Some of you may have viewed the Employee or Contractor Webinar and you will be happy to know that this and other Webinars are now online at the IRS!

The IRS Video portal contains video and audio presentations on topics of interest to small businesses, individuals and tax professionals.  If you were unable to attend a webinar when it was broadcast live, you can watch a recorded version of the IRS webinar by going to   Click on the tab for Small Businesses.