Small business owners and entrepreneurs throughout the US are facing impossible choices because of the skyrocketing costs of health insurance premiums, and, in many cases, the lack of access to coverage. Here are some of their stories.
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Bagel Grove | Utica, New York
Bagel Shop Gets Relief Thanks to Tax Credits
Matt Grove
Bagel Grove
Utica, New York
Founded in 1988
Full-time employees: 14
In 2005, Matt Grove and his wife Annie took over the family business, a longtime bagelry in upstate New York. The company, which Matt’s father opened in 1988, had always provided a co-pay health insurance policy to its employees. When Matt took over Bagel Grove, he decided to add high-deductible plan as a second choice to his staff, despite the fact that costs were rising astronomically. However, the exorbitant rates cut into their bottom line and forced Matt and Annie to cut back on the plans they offered and offer plans with a higher co-pay and deductible.
Before passage of the Affordable Care Act, the Groves wanted to cover more of the premium cost for their staff, but the rapidly increasing rates tied their hands.
Then healthcare reform passed.
Matt carefully studied the ACA’s effect on small business owners and learned about the healthcare tax credits. He qualified for the full credit of 35% and used the extra savings to increase the percentage of the premiums the business covers, from 50% to 65%. That’s essentially money in his employees’ pockets.
Matt believes offering health benefits is not only the right thing to do, but helps him retain and attract good employees. Providing health insurance has made this possible in the past and even today—employee turnover costs the business money and creates headaches. The Affordable Care Act has made this easier to accomplish, and Matt is also confident that future tax credits will enhance his ability to afford coverage.
“In the long run, I am hopeful that healthcare reform will create a culture that allows for basic coverage,” Matt said. “The tax credit is going up to 50% in 2014, and by the time that kicks in, we will pick up a higher percentage of premium costs. “
