The Affordable Care Act has received tremendous attention in the news lately thanks both to the October 1st opening of healthcare exchanges as well as to the attempts of some in Congress to limit or defer this act (also known as “Obamacare”) as a condition of providing federal financing for the current fiscal year. Some politicians have argued that it will be very detrimental, even crippling, to small companies.
But author James Surowiecki has a different opinion. Writing in The New Yorker magazine, he argues that “Obamacare may well be the best thing Washington has done for American small business in decades”. He points out that entrepreneurship in general may get a significant boost, since many potential entrepreneurs might be more willing to risk starting new businesses because they can now obtain health insurance even if they leave their current jobs.
Obamacare will also help alleviate the fear among small companies that just one or two sickly employees (or their family members) will cause their insurance premiums to skyrocket. Under Obamacare, small-business exchanges will permit companies to pool their risks (like large companies now do) in order to obtain cheaper insurance rates.
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