Study: SMBs Could Lose $2.4 Trillion In Healthcare Costs If System Is Not Changed
Written by Ken Gaebler
A recent analysis from the Massachusetts Institute of Technology projects that healthcare will cost SMBs $2.4 trillion in healthcare costs - plus thousands of jobs - if the system is left unreformed.
The most important news for small business owners may be the healthcare reform debate, which could cost small businesses almost $2.4 trillion over the next 10 years if left unchanged, according to a recent analysis.
Jonathan Gruber of the Massachusetts Institute of Technology, using an economic simulation model, determined what the financial consequences would be of an unreformed health care system, contrasting that data with simulations of three potential reform plans.
Small businesses will pay an average of $156 billion in healthcare costs in 2009, climbing to $339 billion in 2018 if the system is unchanged.
Gruber also estimated that approximately 178,000 small business jobs will be lost due to the overwhelming cost of healthcare, under the current system. Reform could save up to 72 percent of those jobs, according to the analysis.
The ideal scenario, a shared responsibility model, could save small businesses $855 billion over 10 years - a 36 percent reduction - Gruber found.
President Obama, in a press conference this week, discussed the importance of reforming the healthcare system.
"We need to control the skyrocketing costs that are driving families, businesses and our government into greater and greater debt," the president said. "When it comes to health care, the status quo is unsustainable and unacceptable."
The majority of small business owners agree, with 66.6 percent reporting that healthcare reform is "very important," according to a recent survey by the National Association for the Self-Employed.
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