The Affordable Care Act took effect Jan. 1 and included a number of provisions set to affect small businesses, The Washington Post reported Tuesday.
J.D. Harrison writes the bill expands the tax credit for small businesses with less than 25 employees from 35 percent to as much as 50 percent.
To receive the new benefits, the companies must buy health plans from a new government-run small-business exchange program, the publication reports.
Insurance companies are no longer allowed to base prices on new plans for companies with less than 50 workers using measures such as claim history, industry, health status of employees and their dependents and employee gender, the report said.
However, insurers can set rates according to employees’ tobacco use and a business’ geographic location, The Washington Post reports.
Harrison writes a new health insurance tax mandated in the law is set to affect small businesses as the tax will be based on an insurer’s fully-insured market share, which is usually bought by small businesses.
According to the report, insurance firms plan to pass on the additional expenses to small business employers, which is expected to push insurance costs about 2 or 2.5 percent.
