The Washington Post

Small business owners remain confused, misinformed about the health care law

Some small-business owners think they know more than they really do about Obamacare. (Andrew Harrer/Bloomberg)

It has been more than three and a half years since the health care law was signed, yet many small-business owners say they still don’t understand the legislation and what it means for their businesses, according to a new study.

Others, meanwhile, think they know more than they really do.

Half of small-business owners say they are only somewhat confident, not very confident or not at all confident that their company will be compliant with the law, parts of which create important new insurance requirements for certain employers. One third say they are not familiar with law, according to the first installment of a three-year health care study by the National Federation of Independent Business, a small-business lobbying group in Washington.

The new health care law has spent the past month in the political spotlight for all the wrong reasons, as its new online insurance marketplaces for individuals and small businesses have suffered a glitch-filled rollout. Just last week, it came to light that the site for employers would not be fully functional until the end of November, a month later than expected.

The technical problems and extended delays have made the marketplaces, called exchanges, “an afterthought at this point” for small business owners, according to Kevin Kuhlman, legislative manager at the NFIB, which has fought back against the health care law since it was signed in March of 2010.

Kuhlman told reporters during a press call about the study that entrepreneurs are struggling to get information on the new rules.

Only one in six business owners say they are very satisfied with the information they have received so far about the health care law, according to the survey, which included responses from more than 900 firms with between two and 100 workers. Some of those employers appear to be “overly confident” about how much they know, the researchers wrote in their final report.

For starters, the NFIB included a specific question about the health insurance exchanges designed to test whether those who said they were familiar with the law knew whether an exchange had been set up in their state (at the time, only two states had launched a marketplace at the time of the poll). Many of the respondents who had said they knew the law well answered the question incorrectly.

Later, researchers asked whether business owners had taken advantage of new tax breaks included in the law, which became available three years ago for firms with fewer than 25 employees. A number of employers said they had taken advantage of the credits, however, when researchers cross-tabulated the data, they noticed that many of those employers were too large to qualify for the breaks.

A similar issue arose when business owners were asked whether they had cut back on employee hours to try to avoid being forced to cover as many full-time workers. Once again, some of the employers who said they had taken that tack were from companies too small to be subject to the requirements.

“The law is a perpetually changing document,” Kuhlman said, noting that that the law includes thousands of pages of statutes and has suffered several delays. “It isn’t difficult to imagine why there is a gap between perceived and actual knowledge about the law.”

Follow J.D. Harrison and On Small Business on Twitter.

J.D. Harrison covers startups, small business and entrepreneurship, with a focus on public policy, and he runs the On Small Business blog.



Success! Check your inbox for details. You might also like:

Please enter a valid email address

See all newsletters

Show Comments
Most Read



Success! Check your inbox for details.

See all newsletters

Your Three. Videos curated for you.
Play Videos
Be a man and cry
Program turns prisoners into poets
Unconventional warfare with a side of ale
Play Videos
The signature dish of Charleston, S.C.
For good coffee, sniff, slurp and spit
The most interesting woman you've never heard of
Play Videos
How to prevent 'e-barrassment'
The art of tortilla-making
A man committed to journalism, caught in the crossfire
Play Videos
Tips for (relatively) stress-free dining out with kids
How to get organized for back to school
How the new credit card chip makes purchases more secure

To keep reading, please enter your email address.

You’ll also receive from The Washington Post:
  • A free 6-week digital subscription
  • Our daily newsletter in your inbox

Please enter a valid email address

I have read and agree to the Terms of Service and Privacy Policy.

Please indicate agreement.

Thank you.

Check your inbox. We’ve sent an email explaining how to set up an account and activate your free digital subscription.