Most Small Business Owners Offer Health Benefits but Oppose Government Mandating Them, According to NAPEO Survey

December 4, 2006; 08:49 AM
A majority of owners of small businesses in a new survey say they oppose government requiring them to offer health benefits, but most already do, bucking the national trend in the small business community.

More than 700 small-business owners served by professional employer organizations, or PEOs, responded to the November survey by the National Association of Professional Employer Organizations, or NAPEO.

The amount of companies in the survey that offer benefits – 95 percent -- is unusually high, because soaring costs make benefits especially hard for small businesses to afford. (Fewer than half of American companies with less than 10 employees offer health benefits, says the Kaiser Family Foundation.)

Increasingly, small businesses outsource many human resources responsibilities, including payroll, workers compensation and health benefits, to PEOs.

The trade association’s first quarterly survey also found more than half the companies responding said their employees were interested in wellness programs to prevent ailments like diabetes and heart disease.

As health costs jump, almost all the companies said they won’t raise the amount employees contribute to their health benefits next year. They didn’t explicitly rule out raising employees’ out-of-pocket expenses – what they actually pay at the doctor’s office – like deductibles and co-payments, as companies large and small across the nation are planning.

But companies that use professional employer organizations find PEOs make it easier and more cost-effective to offer health benefits by assuming the work of administering a health-care plan.

“If America is going to resolve the health-care crisis, it will take all hands on deck,” said Milan P. Yager, executive vice president of the trade association. “The small business owners and operators in this survey – working with their PEOs – are champions of health care options that match today’s workforce.”

NAPEO itself is neutral on government-mandated insurance. It simply asks that new laws requiring businesses with a certain number of employees to provide health insurance treat small businesses that use professional employer organizations the same as other small businesses.

To read the full report: http://www.napeo.org/newscenter/research.cfm