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Begich Bill Makes Purchasing Health Insurance More Affordable for Small Businesses

“Alaska’s small businesses need less red tape and more common sense solutions that work for them”


Expanding his efforts to make the new health care law work for Alaska small businesses, U.S. Senator Mark Begich – a small business owner himself - today introduced legislation to make health care more affordable by expanding tax credits to small businesses so they can continue to compete and grow in America.      

Begich’s bill, the Small Business Tax Credits Accessibility Act, improves access to Small Business Health Care Tax Credits.  Begich believes this tax credit should be available for a longer period of time and accessible to more people.

 “Small businesses need less red tape and more common sense solutions that work for them,” said Begich. “This is why I have introduced a bill to make it easier for small businesses to buy insurance for their employees. Small businesses are the backbone of our economy, making it that much more important that we help them thrive. My bill will do just that.”

Highlights of the bill include:

  • Raising the maximum size of businesses eligible to receive tax credits from 25 employees to 50 employees;
  • Increasing the number of years for which a small business may receive the tax credit to any 3 consecutive years;
     
  • Extending the credit to firms with higher average wages.  Instead of phasing out between $25,000 and $50,000, it would instead phase out between 110 percent and 220 percent of the federal poverty line for a family of four – making the law more practical for states like Alaska with higher average wages;
     
  • Increasing the threshold for a firm to receive the biggest possible credit from 10 to 20 full-time employees;
     
  • Allowing the families of small business owners to directly benefit from the tax credits;
     
  • Eliminating the requirement that employers claiming the credit contribute the same percentage of the cost of each employee’s health insurance;
     
  • Simplifying calculations by eliminating the cap that limits eligible employer contributions to average premiums in the state;
     
  • Extending a 35 percent tax credit to small businesses purchasing coverage outside the SHOP exchange in 2014, while maintaining the tax credit of 50 percent for coverage purchased on the SHOP exchange.

“As a small business owner, I know firsthand the obstacles they face in purchasing health care to their owners. This bill will help extend helpful tax credits to businesses so they can attract and retain workers keep their business strong,” said Begich.

As part of his efforts to improve the health care law for Alaskans, Begich also recently introduced the Expanded Consumer Choice Act to give Alaskans more choices when purchasing health care. The bill would create a tier of insurance called “copper plans” and would give consumers the choice of paying lower premiums if they are willing to pay more for out-of-pocket medical costs. 

Begich also sent a letter to President Obama last November proposing several important improvements to the implementation of the new health care law in order to make health insurance more affordable and allow users to more easily browse and compare plans on the federally run website www.healthcare.gov.

Begich has criticized and voiced various frustrations directly to the President about the health care law. Citing the importance of having the exact same experience as other Alaskans, Begich also signed up last fall on Alaska’s federally run marketplace, forgoing any employer contribution to his plan.

Co-sponsors of the bill include Senators Al Franken (D-MN), Mazie Hirono (D-HI), Jeanne Shaheen (D-NH), Mary Landrieu (D-LA), Mark Warner (D-VA) and John Walsh (D-MT).

A fact sheet on the bill is below:

Office of U.S. Senator Mark Begich Alaska :: February 2014
Official website :: http://begich.senate.gov
Small Business Tax Credits Accessibility Act

Senator Begich supports the new protections and support for small business provided by the Affordable Care Act, including a Small Business Health Care Tax Credit to help employers afford the cost of covering their workers. To make sure small businesses can compete and grow, Senator Begich believes this tax credit should be available for a longer period of time and accessible to more employers. That’s why Senator Begich introduced the Small Business Tax Credits Accessibility Act to expand and simplify this portion of the law. He also wants to make sure tax credits are available in 2014 outside the small business exchange, since it is not yet fully functional in most states.

The Small Business Tax Credits Accessibility Act improves access to Small Business Health Care Tax Credits and supports more businesses by:

  • Raising the maximum size of the business that is eligible to receive the tax credits from 25 employees to 50 employees;
  • Extending the credit to firms with higher average wages. Instead of phasing out between $25,000 and $50,000, it would instead phase out between 110 percent and 220 percent of the federal poverty line for a family of four. This takes into account regional salary differences.
  • (In 2014, 110% of FPL for a family of four is $26,235 in the 48 contiguous states, $32,802 in Alaska, and $30,173 in Hawaii. Thus, the credit would phase out completely at 220% of FPL or an average wage of $52,470 in the 48 contiguous states, $65,604 in Alaska and $60,346 in Hawaii.);
  • Increasing the threshold for a firm to receive the biggest possible credit from 10 to 20 full-time employees;
  • Eliminating the requirement that employers claiming the credit contribute the same percentage of the cost of each employee’s health insurance;
  • Simplifying calculations by eliminating the cap that limits eligible employer contributions to average premiums in the state;
  • Allowing the families of small business owners to directly benefit from the tax credits;
  • Increasing the number of years for which a small business may receive the tax credit to any 3 consecutive years; and
  • Extending a 35% tax credit to small businesses purchasing coverage outside the SHOP exchange in 2014, while maintaining the tax credit of 50% for coverage purchased on the SHOP exchange.
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