Small-business owners in the city reacted cautiously yesterday to President Obama’s far-reaching health-care reforms, saying they were concerned but still uncertain about the potential impact.
In particular, business owners said months of partisan debate over the legislation’s complexities made it impossible to determine whether the changes will make health insurance more affordable or impose costly mandates on them.
“It’s too soon to tell. There are a lot of variables,” said Kenneth Koenig, owner of Roosevelt Building and Maintenance in Queens.
Obama and Democrats in Congress have included a number of carrots and sticks in the plan they claim will make it easier for small to midsize business owners and workers to buy and afford medical coverage.
First, the sticks.
Employers with more than 50 workers will face fines of up to $2,000 per worker if they do not offer coverage to low-income workers, who will be eligible for public subsidies to obtain insurance.
In an effort to curb costs, a 40 percent excise tax on high-priced so-called “Cadillac” insurance plans will go into effect no later than 2018.
But the historic measure also authorizes carrots — states will create large market exchanges or pools to make it easier for businesses and individuals to bargain with insurers to obtain more affordable coverage.
But Koenig, who has a total of 75 full- and part-time workers, was skeptical that costs would go down because the legislation does little to lower medical spending.
He also said businesses will legally game the system by hiring more “independent contractors” to keep their full-time workforce under 50 to avoid penalties for not offering health care .
Kenneth Buettner, owner of York Scaffolding in Long Island City, worries about facing the 40 percent excise tax down the road for being locked into multi-year union contracts.
“I am beholden to the union contract, and it will be easy to hit the luxury threshold,” Buettner said.