One benefit of the new health insurance options and reforms in the Affordable Care Act starting in 2014 will be the positive impact on the creation of small businesses and sole proprietorships. The new paths to health care coverage will allow more individuals to purchase their own coverage instead of having to be employed in order to receive health care insurance.
A recent report found that the Affordable Care Act is expected to produce a sharp increase in entrepreneurship next year, according to the analysis done by the Robert Wood Johnson Foundation, the Urban Institute and Georgetown University’s Health Policy Institute.
The number of self-employed people nationally is expected to rise by 1.5 million — a relative increase of more than 11 percent — as a direct result of the health care overhaul. One major barrier to entrepreneurship in the past in the United States has been the difficulty of getting health insurance on the individual market. A pre-existing condition or disability can make it very expensive and difficult – if not impossible – to purchase health insurance as an individual. Therefore, many people remain employed in a job that is not satisfying in order to maintain health care coverage – referred to as “job lock.” If health care is more portable, more employees will have the freedom to change jobs, retire and/or start their own businesses.
According to the report and this infographic, in Illinois, there are currently 475,000 people self-employed but there are expected to be 537,000 people self-employed after the ACA is implemented – an increase of 62,000 newly self-employed or 13.1%. This increase is due to the new options for health insurance outside of the traditional employer-employee relationship and the elimination of pre-existing condition exclusions in health insurance. The ACA will create insurance marketplaces in every state where individuals and small businesses can shop for insurance and compare insurance products as well as receive financial assistance if they are low income to defray the costs of premiums and cost-sharing.
In Illinois, health care reform implementation is proceeding with the creation of the new Federal State Partnership Marketplace to open enrollment on October 1, 2013 and to start providing coverage on January 1, 2014. Illinois also recently passed Senate Bill 26 to expand Medicaid under the ACA with the potential to cover hundreds of thousands of additional low income individuals. The bill is currently awaiting the Governor’s expected signature into law. Enrollment campaigns and education and outreach will begin in earnest in the summer. More information on the Illinois effort to implement the ACA can be found at: http://www2.illinois.gov/gov/healthcarereform/Pages/default.aspx and at www.illinoishealthmatters.org.
Health & Disability Advocates