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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Thermal House | Jamaica, VT
Vermont energy efficiency firm:
Unaffordable coverage hinders growth
Lack of a health plan prevents the firm from hiring top talent
Thermal House is a growing company in a growth industry-there's increasing demand for its specialty energy efficiency building services even in these recessionary times. But a major barrier stands between the Vermont-based enterprise and its ability to expand: the high cost of health insurance.
The company, based in Jamaica, Vermont, provides specialized energy audits of commercial and residential buildings, performs energy-saving building improvements, and consults on energy use for new construction projects.
Thermal House founder Keith Abbott sums up his healthcare challenge simply: "I can't hire the best people I could find because they need health insurance for their families. These are the ones we really want, who will help us get to the next level."
The company just had its first profitable year, and providing health insurance would take it back into the red. "If we were three times bigger, probably, with those efficiencies, that would help," says Abbott. "The problem is, how do you get three times bigger?"
"I can't hire the two or three best people I could find because they need health insurance for their families."
Potential employees love the company, but need benefits
One recent potential employee loved the company so much he was willing to take a pay cut. He had technical and management skills that would help Thermal House increase its crew and expand its service area into other parts of New England. But, with three children, he needed health coverage.
"It's really unfortunate," says Abbott. "They may like what we do and believe in the company and our approach towards employees and the environment, but they can't afford to work for us because they can't afford not to have health insurance.
"One of our limiting factors is quality people, and it's very difficult to jump that hurdle without being able to offer benefits," he adds. "It makes it difficult to compete with larger companies."
The hurdle is particularly high for Thermal House because the company is located in a rural area where the talent pool is smaller and few employers provide comprehensive health coverage-which means fewer employees or prospective employees have coverage through a spouse.
"[Healthcare is] a luxury rather than the staple that it should be. It's frustrating that in this one area, we're not supporting our values."
The company chips in where it can, and looks for options
With traditional healthcare plans out of reach, at least for now, Abbott is searching for affordable alternatives. One idea is coupling a catastrophic healthcare plan with a pooled company savings account that employees could draw on to cover the high deductible expenses in the event of an emergency.
Meanwhile, the company helps employees as much as it can, sometimes paying for healthcare costs directly when an employee has a serious problem. In the case of one new hire, the "signing bonus" was covering expenses for extensive dental work.
"It would be cheaper for us in the long run to have coverage, but it made sense that for certain emergency-type procedures-we just said, 'we'll do it,'" says Abbott.
"There's nothing we would like more than to be able to offer people health insurance. It goes along with who we are and what we do," he says. "It just seems impossible at this time. It's very discouraging."