A new Texas law is giving small businesses options to deal with projected increases in the cost of health insurance for their employees.
Senate bill 1332 was signed by Governor Perry this weekend.
Businesses across the country with more than fifty employees will see their healthcare cost increase in 2014,but the new state law will help those businesses in Texas keep their cost the same for the next two years.
Kelly Fristoe is the president of the Texas Association of Health Underwriters, he says keeping the healthcare costs as low as possible for businesses may prevent some salary cuts, losses of health insurance, and even layoffs.
"They may say you know what? We're done. A lot of my groups are already saying if that happens, we're out of the health insurance business and we're gonna say to our employees you go out in the exchange program in that exchange market place and you buy your own insurance," says Fristoe.
Under the new law Texas businesses with fifty to one hundred employees will not have their rate ratios changed which will help keep costs the same for the next two years.
Fristoe says this will help them keep employees and avoid huge increases in the cost of insurance plans.
"A lot of employees that are less than fifty lives and are going to be subject to the rate shock they may get their renewal rates next year in the month of February, look at that and go oh my gosh a 60 percent rate increase," says Fristoe.
Fristoe says insurance prices will continue to go up after the affordable care act is implemented in 2014 so keeping rates low for businesses now will help lessen the impact on employees later on.
"You can't expand benefits like that with out expanding the price also, you can't tell the insurance company you have to cover all these extra things and by the way it has to be less expensive," says Fristoe.
Fristoe says younger employees will be most affected by the affordable healthcare act, because they will paying a higher percentage of the costs of healthcare.
So when looking for a job, he says its more important than ever to look at a company's healthcare benefits.
The rates do not change until your renewal period comes up in 2014.
If you want more information on the healthcare bill you can visit the Texas Association of Health Underwriters website.
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