The bedrock of American business lies in the small business sector and, if there was any justice in this world, the small business sector would be encouraged to offer health plans to their employees. So it was good to see the Affordable Care Act apparently offer support. In theory, any small business with less than 25 employees who have an average pay of less than $25,000, can claim a refund of 35% of the premiums paid in the first three years. After 2014, the credit rises to 50%. This sounds good until you hear that only about 170,000 of the eligible firms claimed the credit in 2010. That about 17% of the intended recipients. So what is going wrong when the research evidence shows that more half the small business currently trading offer health plans?
Continue reading “Small business insurance and the health-care tax credit”