02/ 11/ 2008
Report Shows Cost a Critical Factor in Whether Small Businesses Offer Health Benefits
The NFIB Research Foundation recently released new data revealing that the cost of insurance remains a critical factor affecting the ability of an owner to offer employees health care. Of those most affected, owners of new firms are reluctant to introduce health benefits.
"It's much better for employee morale if a small-business owner never offers health benefits than it is to offer them and then be forced to take them away because it is too expensive to continue," says William J. Dennis, NFIB's senior research fellow.
The NFIB Small-Business Poll on purchasing health insurance found that 52 percent of small-business owners do not offer either employee health insurance or an insurance purchase subsidy. Of the 47 percent of small employers who do offer some type of employee health benefit, the breakdown of offerings includes the following:
36 percent offer insurance to all or most full-time employees.
5 percent offer insurance to some or a few full-time employees.
6 percent offer premium reimbursement to employees who purchase health insurance on their own.
The owner or manager is the person most likely to shop on behalf of the firm for health insurance. The poll shows that they rely heavily on insurance agents or brokers for guidance, a practice that does not always serve them well. Survey data found that agents/brokers did not raise the subject of health savings accounts in 59 percent of discussions with small employers.
"If small-business owners want to know about their health-insurance options, they need to conduct their own research. They also need to ask their insurance agents very pointed questions about HSAs and other health-insurance options," Dennis says.
To access the complete poll, please visit www.NFIB.com/research.
