President talks up small business benefits
PORTLAND, Maine - President Barack Obama may not have talked about home medical equipment in his speech here last week, but he did talk about how the new healthcare reform bill would impact small businesses--small businesses like HME providers.
Thanks to the bill, companies with 25 or fewer full-time employees can apply for tax credits worth up to 35% of the cost of health insurance for their workers. The credit is effective Jan. 1, 2010, and it will increase to 50% in 2014.
"Small businesses shouldn't be burdened because they want to do the right thing by their employees," Obama told the cheering crowd of about 2,000.
The majority of HME providers are small businesses: About 63% of providers have 20 or fewer employees and about 41% have fewer than 10, according to a 2009 survey by HME News and Steven Richards & Associates.
Other elements of the small business tax credit: Companies can claim the credit for 2010 through 2013 and for any two years after that; and it phases out gradually for companies with average wages between $25,000 and $50,000 and for companies with the equivalent of between 10 and 25 full-time employees.
Karen Mills, administrator of the U.S. Small Business Administration, also addressed the crowd.
"Small business owners think of their employees as family," she said. "They want to take care of their family and they rank affordable health insurance as their No. 1 concern."
Despite the enthusiasm displayed last week in Portland, Maine, Obama acknowledged that the system won't change overnight.
"This reform is not going to solve every problem with our healthcare system," he said. "It is a huge complicated piece of business. We're going to have to make some adjustments along the way. But it represents enormous progress."
Over the next several weeks, the Internal Revenue Service (IRS) will begin mailing postcards to the estimated 4 million small businesses that may be eligible for the tax credit.
For more information on the small business tax credit, go to whitehouse.gov.