Small Businesses Struggle to Offer Healthcare - Black Enterprise

Small Businesses Struggle to Offer Healthcare

BUSDistressSuitUmbrella_edited-1As the Congressional debate over healthcare reform persists, small business owners are left to fend for themselves and hope for curing relief.

Charles Ewing Sr., owner of Ewing Moving Service Inc. & Storage in Memphis, Tennessee is among those left to bear the burden of high premium and coverage costs.  The small business owner, whose company saw revenues of $3 million this past year, has eliminated healthcare insurance for all but five of his 47 full-time employees.

“We’re planning to offer our employees the amount of cash that we would pay for healthcare to them as a bonus,” says Ewing, 50, who started the company in 1980. “They can purchase their own healthcare and get it cheaper.”

BlueCross/BlueShield is Ewing Moving Service’s insurance provider and the cost is split 50/50 between the company and staff for single coverage.  Ewing says he came to his decision as premium costs rose 15% to 20% annually. While insured employees were paying half of the $224 per month, Ewing’s bill to insure his employees peaked at $3,600 monthly.  He says he even shopped around to another insurance provider, Humana, but to no avail because although Humana’s rates were cheaper, since some employees have preexisting health conditions, Ewing would be charged more.

Ewing says because of the rise in healthcare costs, it is difficult for him to recruit new employees because the benefits package is not attractive enough to compete. And he is not alone in his efforts.

According to Aflac Inc., the largest provider of supplemental insurance in the United States, small business owners are taking drastic measures to remedy their company’s insurance dilemma.  Their study, “Small Business: Now More Than Ever,” led by Accelerant Research interviewed small businesses with five to 99 employees, not home-based and with annual revenues of at least $100,000.