Health Care Reform – A Small Business and Vending Operator Perspective
Introduction – The Health Care Reform Bill, H.R. 3590
The health care reform bill, H.R. 3590, is a highly contested item for debate, even with its passing earlier this week. We have seen the ‘ups and downs’ of thought on both sides of the fence, from the partisan tactics of Washington, to the common opinions of middle-class women and men.
We have seen response in all avenues of media, whether it be television, radio or newspaper. We have seen millions of responses worldwide to the adaptation of this bill, and all of the follies and fancies that come with it. However, the ease is unwary, and the mood a bit shaky, as we all pass through our collective American conscious and opinions on the various reasons why we are for or against it.
This change is not a mere reflection of all things considered, but a much deeper concern. It is one idea that rests on the laurels of all-American people, from the heartland to big city. Essentially, our perspectives are being noted in our democratic efforts to speak what we think, and to be resolute in our affirmations on the subject. With that being said, one such industry that is undergoing change in lieu of this bill is the vending machine industry.
Summarizing Some Elements of The Bill
To get a firmer grasp on the bill itself, here is an introduction to the generalities of it. The national health care reform bill, or the “Patient Protection and Affordable Care Act” is a 2,393-page bill (as of right now) that reflects momentous changes to the health care system, and as well to many other facilities that relate to precursors of the health care system and individual health.
First, it must be noted that a vending machine business operator is classified as an entrepreneur. In addition, under the new health care bill, there are options for small business professionals and entrepreneurs. If you classify as being self-employed, as most entrepreneurs are, by 2014 you may qualify to receive government subsidies or Medicaid. As well, preexisting conditions are thrown out, and you cannot be denied insurance for them.
For The Small Business Owner
There are some concerns however. Particularly, the caps to insurance policies are not hard coded, meaning that insurance premiums by 2014 will most likely rise considerably from insurance companies upping the rates.
For small business owners, if you have 50 or more employees, you are required to provide health care to them, under the reform bill. If you do not, you will be faced with a fine. How much this fine is for is up to debate, but one thing is certain, you could be penalized for the above mentioned.
If you are a small business owner with less than 50 employees, you will not be required to provide this mandatory health care opt-in.
Small business owners could potentially see tax credits for 2010 and beyond. If the business has fewer than 25 employees, and it pays at minimum 50% of the health care premiums for their employees, they would qualify for a tax credit up to 35% of your premiums, and by 2014, that number could be increased to 50%. This tax credit is not available for sole proprietors though, which is one caveat.
As far as personal coverage goes, by 2014, you will be required to opt-in for health insurance, or also face a fine. However, if more than 8% of your income goes to the cheapest available plan, you will not face a fine.
For the taxpayer who makes over $200,000 dollars individually or $250,000 dollars as a family, the Medicare tax rate will be augmented from a 1.45% to 2.35% tax rate. If a small business owner receives capital gains or other income based on interest (such as dividends), there could be a larger hike to their Medicaid tax rate as well.
For The Vending Machine Operator/Business
For the vending machine operator especially, this new legislation introduces the necessity for the owner to include nutritional labeling on their vending machines, if they have 20 or more of them. Opinion is divided between the change, but one thing is certain. For the small to medium vending machine business owner, it will take time and money to implement.
Particularly, it will cost money to print and attach the nutritional labels to the machines, and say if it was $10 dollars per label and you had 200 machines, that would be $2,000 dollars overall. For a small to medium sized business that still is a lot of money.
Also, if product does change in the machine the owner will have to keep the label up-to-date, which means a new label will have to be made, and more money will go out of the pockets of the vending machine business owners.
Essentially what this debate centers on is small business versus big business. In general, a big business can incur the costs associated with labeling the vending machines at their locations, but the real burden could potentially be felt by smaller sized business owners.
For The Future
Tax burden could be felt over several different areas in the future for business owners. One such being the so-called “soda tax” which is reported as being around $0.03 cents for every soda sale. For the soda tax, consensus points to factors such as the relationship between full-calorie sodas and obesity, and a root solution would be the tax. The tax is seen as a deterrent for people making unhealthy choices, and also a revenue generator for tax income. However, the future is uncertain for the soda tax, but it could become a reality within the next 5 years if enough proponents get behind the idea.
As consensus still shifts from the various arguing points of the bill, over the “pros and cons” and individual merits of this legislation, one thing is certain. The small business owner will face different challenges over the next few years, as well adaptations that could potentially be seen, in the face of all this change.