Once fully implemented, the聽2010 health care law will increase employer-sponsored insurance coverage and reduce the cost small businesses pay for employee health coverage, according to an .
The analysis, prepared by Urban鈥檚 Health Policy Center,聽says that if all provisions of the health law were implemented this year, the number of Americans covered by employer-sponsored insurance would increase by 2.7 percent and costs-per-person for small businesses (fewer than 50 workers) would decrease by 7.3 percent. Overall for small businesses, those with under 100 employees, total health insurance spending would be reduced by 1.4 percent.
Only mid-size businesses, which the study defines as having 101 to 1,000 employees, would see a 4.6 percent increase in costs-per-insured-person.
Since most large businesses (more than 1,000 employees) currently聽provide聽health insurance for their workers, the law would increase their costs by 4.3 percent, due mostly to somewhat higher employee enrollment rates because of聽an increase聽in the number of workers and dependents who will get coverage.
The Urban report said it did not take into account the heath law鈥檚 cost containment provisions for Medicare which聽aim to reduce federal spending on the entitlement program for the elderly and disabled. 鈥淧rivate purchasers will benefit from Medicare cost containment if they similarly press insurers and providers for efficiency,鈥� the report concludes.聽 The architects of the law hope the Medicare payment reforms will bring down costs in the public and private markets.
Kevin Kuhlman, manager of legislative affairs for the , said the report 鈥渕ay overestimate the benefits of the law and underestimate the cost impacts of benefits on businesses.鈥�
For example, he said, far fewer small businesses than anticipated have used the law鈥檚 small business tax credits to help offset the cost of providing health insurance to employees. 鈥淗indsight now tells us the take-up rate is much smaller,鈥� Kuhlman said, referring to a聽聽that found聽just聽4 to 12 percent of small businesses eligible for health insurance tax credits claimed them in 2010.
Since federal regulations implementing the聽law鈥檚 package聽have聽not yet been released,聽if those benefits聽are overly generous they will add to the cost of insurance, Kuhlman said. He also adds that the report does not assess the impact of the health law鈥檚 new taxes and fees, many of which start in 2014,聽on the cost of health insurance.