Secretary of Health and Human Services Kathleen Sebelius and Small Business Administration Administrator Karen Mills recently released a new report, "Insurance at Risk: Small Business Employees Risk Losing Coverage."
The report looks at the financial difficulties small businesses face when providing health insurance to their employees. According to the report, employees of small businesses were 50% more likely to lose coverage as workers at large businesses. Half of workers in small firms that do not offer health benefits remain uninsured.
In addition, premiums for employer-based health insurance have more than doubled since 2000, rising three times faster than wages. As a result, fewer small businesses provide coverage for their employees. In 2000, 57% of firms employing less than 10 workers provided coverage. In 2009, 46% of similar-sized firms provided coverage.
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In one national survey, nearly three-quarters of small businesses that did not offer benefits cited high premiums as the reason, and on average small businesses pay up to 18% more than large firms for the same health insurance policy. This is due in part to high broker fees, which can be up to 10% of premiums, and health plan administrative costs that are three to four times those in the large group market.
The complete report is available at www.HealthReform.gov.
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