Insurance Lapse

Insurance Lapse

As the Congressional debate over healthcare reform persists, small business owners are left to fend for themselves and hope for curing relief.

Charles Ewing Sr., owner of Ewing Moving Service Inc. in Memphis, Tennessee, is among those left to bear the brunt of high premium and coverage costs. The business owner, whose company saw revenues of $3 million this past year, has eliminated healthcare insurance for all but five of his 47 full-time employees.

“We’re planning to offer our employees the amount that we would pay for healthcare as a bonus,” says Ewing, 50, who started the company in 1980. “They can purchase their own cheaper.”

BlueCross/BlueShield is Ewing Moving Service’s insurance provider and the cost is split 50/50 between company and staff for single coverage. Ewing says he came to his decision as premium costs rose 15% to 20% annually. Ewing’s bill to insure his people peaked at $3,600 monthly. He says he even shopped around but to no avail.

According to Aflac Inc., the largest provider of supplemental insurance in the United States, small business owners are taking drastic measures to remedy this dilemma.

President Obama is adamant about seeing healthcare reform by the end of the year. In his fiscal 2010 budget, Obama plans to reserve $630 billion over the next 10 years toward financing reforms for the healthcare system. This money will allow people to have a choice between health plans and physicians, which they anticipate would lead to more affordable healthcare.

“In many states, there is no competition in the private insurance market,” says ReShonda Young, 34, operations manager for Alpha Express Inc., a family-owned 34-employee courier service based in Waterloo, Iowa, and member of the National Advisory Council of the Main Street Alliance, which works with small businesses to advocate for healthcare. “A public option is the best option. If not, there needs to be government regulation and transparency.”

This article originally appeared in the September 2009 issue of Black Enterprise magazine.