Legislative fix would help protect small businesses from risk of increased healthcare costs

Our country’s small and mid-sized businesses owners and their employees make our economy run. We are both former small business owners, and we understand both the long hours and financial pressures facing entrepreneurs looking to get their business off the ground, as well as their commitment to providing a positive working environment for their employees. The Americans powering our small businesses are our family, our friends and our neighbors, and they deserve common-sense solutions to the challenges they face.

Many businesses have long struggled to provide affordable healthcare coverage, and we applaud them for offering this important benefit to their employees. Under the Affordable Care Act, the definition of small group market is scheduled to expand from employers with up to 50 employees to include employers with up to 100 employees.


A recent actuarial report projects that approximately two-thirds of mid-sized businesses, their employees and their families could see an average 18 percent premium increase due to how the Affordable Care Act expands the definition of the small group market.

That’s why we’ve come together to introduce the Protecting Affordable Coverage for Employees (PACE) Act to protect small and mid-sized businesses from disruption and potential premium increases. Premium increases could destabilize the market in these newly expanded small group markets, and a disruption could worsen over time as more and more mid-sized employers opt to avoid the new requirements and related premium increases.  Those left in the newly expanded small group market could see significant premium hikes, according to experts. 

Republicans and Democrats must continue to work together on improving healthcare laws that impact our small and mid-size businesses. Expanding the definition of the small group market could disrupt the small group insurance market.  For example, many mid-size employers (51-100) would be unable to keep their current health insurance plans. Rather than incur additional costs associated with these rules, mid-sized companies whose employees are generally healthy could elect to leave the newly expanded small group market – either opting to self-fund so they will not be subject to the ACA rules, or dropping coverage entirely.

In order to prevent potential premium hikes, our bi-partisan legislation would allow states to maintain the health care status quo for employee coverage by keeping the current small group market definition in place. We’re thankful to be joined by cosponsors Senate Finance Committee Chairman Orrin HatchOrrin Grant HatchTrump to award racing legend Roger Penske with Presidential Medal of Freedom Trump awards Presidential Medal of Freedom to economist, former Reagan adviser Arthur Laffer Second ex-Senate staffer charged in aiding doxxing of GOP senators MORE (R-Utah), and Sens. Michael BennetMichael Farrand BennetSanders doubles down on 'Medicare For All' defense: 'We have not changed one word' Democratic candidates face hard choices as 2020 field winnows The Hill's Campaign Report: Democratic field begins to shrink ahead of critical stretch MORE (D-Colo.), Chris CoonsChristopher (Chris) Andrew CoonsThe United States broken patent system is getting worse Biden faces scrutiny for his age from other Democrats Democrats press FBI for details on Kavanaugh investigation MORE (D-Del.), Joe DonnellyJoseph (Joe) Simon DonnellyLobbying world Trump nominees meet fiercest opposition from Warren, Sanders, Gillibrand GOP frets over nightmare scenario for Senate primaries MORE (D-Ind.), Johnny IsaksonJohn (Johnny) Hardy IsaksonGeorgia senator discharged from hospital after fall Georgia senator hospitalized after fall Senate GOP raises concerns about White House stopgap plan to avoid shutdown MORE (R-Ga.), Lisa MurkowskiLisa Ann MurkowskiOvernight Energy: Green groups sue Trump over Endangered Species Act changes | Bureau of Land Management retirees fight plan to relocate agency | Wildfires in Amazon rainforest burn at record rate Bureau of Land Management retirees fight plan to relocate agency out west The Hill's Morning Report - Progressives, centrists clash in lively Democratic debate MORE (R-Alaska), Pat RobertsCharles (Pat) Patrick RobertsThe Hill's Campaign Report: Democratic field begins to shrink ahead of critical stretch Kobach says he's more prepared for 'propaganda' in Senate campaign Pompeo: Senate run 'off the table' MORE (R-Kan.) and Jon TesterJonathan (Jon) TesterNative American advocates question 2020 Democrats' commitment House Democrats targeting six more Trump districts for 2020 Budget deal sparks scramble to prevent shutdown MORE (D-Mont.). Additionally, nearly 20 groups representing small and mid-sized businesses, state and local legislators and health policy experts from both parties, and consumer advocates from across the country support this fix.

We can all agree that keeping costs down for small and mid-sized businesses and the workers who depend on them makes sense. Time is of the essence. Congress must act now to avoid disruption and premium hikes in policies that take effect in 2016.  Working together, we can put in place this common-sense solution and help all of our communities.

Scott is South Carolina’s junior senator, serving since 2013. He sits on the Banking, Housing and Urban Affairs; the Finance; the Health, Education, Labor and Pensions; and the Small Business and Entrepreneurship committees.  Shaheen is New Hampshire’s senior senator, serving since 2009. She sits on the Appropriations; the Armed Services; the Foreign Relations; and the Small Business and Entrepreneurship committees.