WaPo: ObamaCare is pretty much a compliance nightmare for small businesses

posted at 9:41 am on December 11, 2013 by Erika Johnsen

It certainly is not news, per se, that ObamaCare is imposing a whole raft of complex, costly new rules and regulations upon smaller businesses that are going to have to seriously struggle to summon the resources to cope with them, but the Washington Post‘s latest piece on the subject highlights an as yet little noticed set of specific rules that are really going to bring the pain on the business models employed by small owners and entrepreneurs across the country. There’s been plenty of discussion about the disincentives surrounding the 50-employee threshold above which employers must either provide health insurance to their workers or else pay a hefty penalty, but for the purposes of ObamaCare, even several completely separate small businesses can be lumped into the larger-businesses category if they share a single owner and the number of workers tally over 50. It’s going to get complicated:

“We, like most of the operators we know, participate in multiple restaurant entities, with various partners, often with family members” Winstanley said during a recent hearing before the House Small Business Committee. “Though we consider each operation to be a small business, many of us are discovering that for the purpose of the health care rule, all of the businesses must be considered a single employer.” …

Often overshadowed by rules concerning the number of hours that constitute full-time employment or the number of workers that define a small business, the aggregation rules pose an addition compliance headache for a large number of small business owners. In fact, roughly four out of 10 small firms with at least 20 employees are run by employers who own at least 10 percent of at least one other company, according to research by the National Federation of Independent Business.

Due to the complicated nature of the rules, many of those firms will be forced to hire a tax attorney to determine their size status under the law, according to Debbie Walker, a Washington accountant who testified at the hearing.

Winstanley estimates that could cost him upwards of $10,000 — and that’s just for the legal counseling. Should he indeed be forced to expand his health care plan to every one of his companies (he already offers care at some firms), he says his current business model may no longer work, and he and his brother will think twice about adding new restaurants.

ObamaCare’s proponents just adore talking about how ObamaCare is really, totally, seriously “creating jobs,” which, in the most literal and technical sense, it most certainly is — but at what opportunity cost? Sure, a bunch of businesses need to hire specialized accountants and attorneys and lobbyists now, but those resources could be and would be better and more productively spent elsewhere rather than diverting them into regulatory compliance.

In related and similarly unsurprising news, Bloomberg reported last Friday that the White House was well aware the the small-business-centric exchanges they once so confidently trumpeted wouldn’t be ready even remotely on time, but chose to withhold that information from the general public for just about as long as they could manage it. Just another casual day in the life of the Most Transparent Administration, Evah.

The decision to delay the Obamacare health exchange for small businesses was withheld from the public for at least six weeks, according to internal e-mails released by a congressional committee investigating the rollout.

CGI Group Inc., responsible for getting the insurance shopping site for small business open Oct. 1, told the Obama administration in August the marketplace wouldn’t be completely ready until at least Nov. 15, according to documents released today by Republicans on the House Energy and Commerce Committee.

The administration was still saying publicly as late as Sept. 26 that the Small Business Health Options Program was on schedule. A news release that day by the Department of Health and Human Services said the SHOP exchange would open Oct. 1.

“We see more and more evidence that the administration was fully aware its signature health care law was not ready for prime time,” Representative Fred Upton, the committee chairman and a Michigan Republican, said in a statement.


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

A good time to raise the min wage!

Bishop on December 11, 2013 at 9:45 AM

WaPo: ObamaCare is pretty much a compliance nightmare for small businesses everyone

More accurate.

Bitter Clinger on December 11, 2013 at 9:46 AM

Well, if you didn’t build that, what do you care?!

Shy Guy on December 11, 2013 at 9:46 AM

Pivot to minimum wage increase stat!
-wh

cmsinaz on December 11, 2013 at 9:46 AM

Great minds bishop :)

cmsinaz on December 11, 2013 at 9:47 AM

CGI Group Inc., responsible for getting the insurance shopping site for small business open Oct. 1, told the Obama administration in August the marketplace wouldn’t be completely ready until at least Nov. 15,

The administration was still saying publicly as late as Sept. 26 that the Small Business Health Options Program was on schedule.

A news release that day by the Department of Health and Human Services said the SHOP exchange would open Oct. 1.

The show is over. Exit the theater.
The grownups have entered the chamber, and to the disappointment of a few, we’re not gonna have a govt. shut down.
Exchanges open Oct 1st.

verbaluce on September 25, 2013 at 2:41 PM

The quote that just keeps on giving right into the holiday season. Happy Ramadan!

Bishop on December 11, 2013 at 9:50 AM

End game: Big government should run & control all businesses.
Small businesses should go through the government to have employees assigned to them. Big government will provide health care to employees.

albill on December 11, 2013 at 9:51 AM

NRCC 2014 campaign slogan:

OBAMACARE. WE DIDN’T BUILD THAT.

M240H on December 11, 2013 at 9:57 AM

ObamaCare: Man-caused disaster.

Bitter Clinger on December 11, 2013 at 9:59 AM

“We see more and more evidence that the administration was fully aware its signature health care law was not ready for prime time,” Representative Fred Upton, the committee chairman and a Michigan Republican, said in a statement.

So why did they go ahead with the roll out as if it was 100% up and running. Why not some cautionary caveats leading up to 1 October? Instead we got this from the White House:

this is a historic day for a good reason.

It’s been a long time coming. But today Americans who have been forced to go without insurance can now visit healthcare.gov and enroll in affordable new plans that offer quality coverage. That starts today.

And people will have six months to sign up. So over the next six months, people are going to have the opportunity, many — in many cases for the first time in their lives — to get affordable coverage that they desperately need.

Now of course, if you’re one of the 85 percent of Americans who already have health insurance, you don’t need to do a thing. You’re already benefiting from new benefits and protections that have been in place for some time under this law. But for the 15 percent of Americans who don’t have health insurance, this opportunity is life- changing.

It’s called managing expectations. You don’t roll out a program full of hype when you can’t deliver.

Happy Nomad on December 11, 2013 at 10:02 AM

OT- Washington Redskins QB RGIII has been benched!

Happy Nomad on December 11, 2013 at 10:03 AM

Stop the whining and complaining you bourgeois wimps! The dialectic-historical struggle of the proletariat requires sacrifices from all of us!

Valkyriepundit on December 11, 2013 at 10:03 AM

End game: Big government should run & control all businesses.
Small businesses should go through the government to have employees assigned to them. Big government will provide health care to employees.

albill on December 11, 2013 at 9:51 AM

I want Veronica Von Horror assigned to my shop, I won’t even require her to do work, just stand there; look at that ink.

http://www.crhoy.com/wp-content/uploads/2013/04/veronica-2.jpg

Bishop on December 11, 2013 at 10:07 AM

I read an article once that said all of us are guilty of at least one felony unknowingly, some people more than one. There are so many laws and interpretations of those laws on the books that we can’t avoid breaking some obscure law. And as we have seen, if they want to get you, they will get you.

Sounds like what is going on here.

Johnnyreb on December 11, 2013 at 10:09 AM

Why isn’t a bigger deal being made of the WH connections to CGI?

Maybe there’s a problem of which scandal to pursue first, but we’re in special prosecutor and jail time territory now. If not, conservatives should tar and feather the gutless GOP and then go after the Dems.

This is a disgrace.

BuckeyeSam on December 11, 2013 at 10:10 AM

Why isn’t a bigger deal being made of the WH connections to CGI?

Maybe there’s a problem of which scandal to pursue first, but we’re in special prosecutor and jail time territory now. If not, conservatives should tar and feather the gutless GOP and then go after the Dems.

This is a disgrace.

BuckeyeSam on December 11, 2013 at 10:10 AM

Because the President and First Lady are Black and Democrats. Well. The First Lady is Black. NAACP had to make an exception for Barry.

oldroy on December 11, 2013 at 10:13 AM

Sebelius is having a rough time explaining this fiasco on the TV right now.

forest on December 11, 2013 at 10:23 AM

WaPo: ObamaCare is pretty much a compliance nightmare for small businesses

Really? Gee, nobody saw that coming!!!!

UltimateBob on December 11, 2013 at 10:24 AM

I want Veronica Von Horror assigned to my shop, I won’t even require her to do work, just stand there; look at that ink.

http://www.crhoy.com/wp-content/uploads/2013/04/veronica-2.jpg

Bishop on December 11, 2013 at 10:07 AM

After you pry her from cold, dead hands …

TXUS on December 11, 2013 at 10:30 AM

Just imagine what would have happened if President PantLoad didn’t use his Imperial Super VooDoo Powers to delay the employer mandate for a year.

Thanks Obama!!!

BigWyo on December 11, 2013 at 10:37 AM

And Obama blamed the hc.gov fiasco on the fact that there were 40 pages of federal rules they had to work through to contract for IT services.

Who writes his stuff? A collaboration of Clue Johnson and Less Smith?

NeoDawg on December 11, 2013 at 10:37 AM

You’re kidding!!!!!!!!!!!! Now is the Washington Post going to do the right thing and call for the repeal of this terrible law, of course not.

SC.Charlie on December 11, 2013 at 10:39 AM

King Obama needs to be impeached.

SC.Charlie on December 11, 2013 at 10:41 AM

Well, if you didn’t build that, what do you care?!

Shy Guy on December 11, 2013 at 9:46 AM

Maybe this is what the tax attorneys should tell the IRS/HHS:

“Um, my client didn’t build that small business. You need to find whoever that is and have them pay the tax and buy the insurance.”

Tsar of Earth on December 11, 2013 at 10:44 AM

Will Obamacare be repealed or won’t it? Will Congress fund it or won’t it? Will the web site be fixed or wont it? Blah, blah, blah. We the people just need to do what we need to do and Congress be damned. Resist. Refuse. Revolt. EXEMPT OURSELVES! We did not comply with Prohibition and we simply should not comply with Obamacare. For religious reasons. For privacy reasons. For the cause of liberty and freedom and in protest of the idea that the federal government (under one party rule, no less), can force private citizens to purchase anything with our own money. Are we citizens or subjects? Mice or men(women)? Just say NO to socialism and to the corrupt, unionized, far left IRS: the gestapo of America’s political class. And have no fear; after all, the federal government ignores millions of illegals who are breaking U.S. immigration law every day and nothing happens to them! Our Founders pledged their lives, their fortunes and their sacred honor. All we have to do is just say no to a scheme we all know is un-American and a violation of our most basic founding fundamentals of privacy, self reliance, limited government and individual freedom.
The Refusniks

devan95 on December 11, 2013 at 10:58 AM

End game: Big government should run & control all businesses.
Small businesses should go through the government to have employees assigned to them. Big government will provide health care to employees.

albill on December 11, 2013 at 9:51 AM

No, Democrats want to drive small businesses out of business, and take over the big businesses. When everyone gets their paycheck from the government, the governmentn controls everyone.

ITguy on December 11, 2013 at 11:09 AM

Now is the Washington Post going to do the right thing and call for the repeal of this terrible law, of course not.

SC.Charlie on December 11, 2013 at 10:39 AM

The WaPo position is essentially that Obamacare and its wealth distribution is a justifiable public policy because of all the good it does for the parasites, moochers, and others who only take from society.

Happy Nomad on December 11, 2013 at 11:14 AM

Mission accomplished.

Keep voting democrat!

Murphy9 on December 11, 2013 at 11:17 AM

They’re shooting for 100% employment of lawyers, while getting people that do real work laid off.

sadatoni on December 11, 2013 at 12:15 PM

So why did they go ahead with the roll out as if it was 100% up and running. Why not some cautionary caveats leading up to 1 October?

Happy Nomad on December 11, 2013 at 10:02 AM

Because those elites, honestly believe their great unwashed subjects (the citizens) are actually so stupid that we wouldn’t notice.

– Smoov

Smoovious on December 11, 2013 at 12:22 PM

“Clearly, the only logical answer is to eliminate these pesky..what was it that you called them? Ah, yes: ‘small businesses‘. They will needlessly complicate and obstruct implementation of ObamaCare.

We have not heard of these ‘small business’ things of which you speak, here in Washington. They seem, somehow illegal—or, perhaps, should be. Let’s work on that.”

–Kathleen Sibelius
(if she was really honest)

orangemtl on December 11, 2013 at 2:45 PM