Small Business

How Does the Affordable Care Act Affect Small Businesses in 2020?

Updated on January 28, 2020


Updated January 28, 2020

It’s been a whirlwind of change in the health care world—as a small business owner, you may be wondering how you are being affected, or might be affected in the future by changes being made.
Keep reading to see how other small business owners report feeling about how the Affordable Care Act (ACA) affects them in 2020.

How is health care reform impacting small businesses in 2020?

There’s no black and white answer for how much small business health insurance has been impacted by health care reform in the past few years—but if anyone’s opinion on the matter means the most, small business owners themselves probably rank pretty high.

According to an eHealth study conducted in 2019, small business owners reported their personal opinions on matters concerning new health-care laws and reform.

Some ways in which health care and the health insurance market changes may be affecting small businesses include:

  • Rising prices in the individual health insurance market (plans becoming more unaffordable for those without employer-based health insurance)
  • Repeal of the individual mandate tax penalty
  • Open enrollment dates

Rising Prices

Individual health insurance prices have been increasing over the years. According to the eHealth report:

  • Premiums – In 2018, the average premium per person under a small business plan ($409) was 7 percent lower than the average premium for an individual plan ($440).
  • Deductibles – In 2018, the average deductible per person for small business plans was 31 percent ($1,438) lower than the average deductible for individual coverage ($3,140 vs. $4,578).
  • Individual vs. group prices – While the average per person premium for small business coverage increased only 5 percent between 2015 and 2018, premiums for those who buy their own individual coverage increased 54 percent in the same period (from $286 in 2015 to $440 in 2018).

Overall, small business health insurance plans tend to have lower average per person costs compared to coverage in the individual market. Small business plans have also shown significantly more premium stability than individually purchased coverage.

Repeal of the individual mandate tax penalty

In late 2017, the tax penalty for going uninsured was repealed. This means in 2020, people will no longer risk being fined for not having health insurance. This is a major change to the Affordable Care Act, but according to eHealth’s survey, 76 percent of small business owners do not feel this repeal will affect whether or not they provide coverage.

Source: eHealth 2018 Small Business Health Insurance Report

Open enrollment dates

Since Obamacare first came into effect, the yearly Open Enrollment Period has significantly shortened in length. This could affect people shopping on the individual market, but luckily for those who qualify for group health insurance, there is no open enrollment period—you can enroll in a plan at any time of the year.

How to stay on top of health care reform as a small business owner

Although the majority of small business owners involved in eHealth’s survey seemed to report minimal effects of health care on their small businesses, it’s still important to stay on top of health care reform, and how it may change your group health insurance plan, or how small businesses go about getting health insurance.

You can follow the news on eHealth’s newsroom, and stay on top of how health care reform affects small businesses.

Shopping for small business health insurance plans

Now that you know most people who enroll in group health insurance plans save on premiums per individual, and often benefit from lower deductibles, visit to see what plans are available in your area for a business like yours.

We have made it easy for small business owners to shop year-round for quality, affordable plans that will keep your employees covered with health benefits that won’t break your bank.

This article is for general information and may not be updated after publication. Consult your own tax, accounting, or legal advisor instead of relying on this article as tax, accounting, or legal advice.

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