Burdensome healthcare costs doom small businesses and cascade nationally---only universal coverage solves.

Small businesses are independent establishments wholly owned by an individual, a family, or business partners. Small businesses are vital to local and national economies. In the aggregate, they have a very large impact on the nation, but individually, they are truly small.1 As such, the influence of small businesses could easily be overlooked, especially when health insurance legislation's focus is on individuals and large businesses.

The current American health insurance system is not sustainable because it increases the burden on large employers while providing a potentially untenable situation for small employers, does nothing to control rising medical costs, and does not provide universal insurance coverage. Specifically, the way the health insurance system works for small employers highlights these problems by providing optional guidelines with little assistance and no standardization for coverages among employers. Employers are then left to choose between providing potentially unaffordable coverage or forcing themselves and employees to find insurance on the individual exchange, which might not be any more affordable.

This Article explains the current health care and insurance laws and regulations, how it affects small businesses, why it is not a solution for the future, active proposals in Congress, and viable options for the future of small business health insurance.

II. ORIGINS OF THE CURRENT EMPLOYER-BASED INSURANCE SYSTEM

A. Health Care or Health Insurance

Health care, health insurance, universal care, universal coverage, affordable care, and affordable coverage are terms commonly used to discuss the current issues with the American health system and possible "solutions." The importance of these terms depends on context. Although used interchangeably, health care and health insurance are not the same. Simply, health care includes the physical services provided in preventing and treating health issues, while health insurance is what pays for care for most Americans. Equating the two ideas has created a barrier to certain types of health care affecting many small employers and their full-time employees because there is a gap between subsidized insurance and full-cost insurance payments.

Health care has not seen the same "successes" in increased access as health insurance. Despite the multitude of hospitals and health care centers, there remains a shortage of health care." Time required to travel to the health care provider is a major bar to the consumption of health services, and the travel time and distance can make a doctor's visit financially unaffordable." Hospital closures should be a major concern because individuals who do not have a primary care physician will go to the local hospital for care. Additionally, medical emergencies are much less likely to have positive outcomes when an individual must travel hours to see a health care provider.'5

The issues with equating health care and health insurance are very important to the future of small-employer health insurance because those issues drive up the costs of health care. Individuals will pay more. Self-insured small employers will pay more and more often, as the cost of even a primary care visit at a hospital could be above an employee's deductible. Reinsurance' could become more expensive as insurers recognize the increased costs associated with offering that coverage for small employers, possibly leaving this option unaffordable for more small employers. Further, community ratings for Small Business Health Options Program (SHOP) marketplace plans could very well reflect the increase in cost for services, leaving small employers and their employees with increased premiums without increased benefits.