This is the fourth in an ongoing series of posts looking at the impact of the new federal health care reform law on Oklahoma and Oklahomans. Our previous posts have explored the “cliff effect” , the  impact on state budgets and the Temporary High Risk Pool. For full information on health care reform, the Henry J. Kaiser Family Foundation website is excellent. If you have thoughts on health care reform, we encourage you to contribute a comment or a guest blog.

Most people who have been following the Affordable Care Act, the new health care law passed earlier this year, know that the law will strengthen the individual market for health insurance coverage, by offering subsidized coverage on the new health insurance exchanges, and expand access to public coverage for low-income families through Medicaid. What is less well known and understand is that the Affordable Care Act also includes several important mechanisms for strengthening the beleagured employer-based system of health insurance coverage, especially for small businesses that currently face the greatest challenges in offering coverage to their workers and where the rates of the uninsured are currently the highest.

A recent report from Families USA looks at one of the most important provisions of the new law, tax credits for small businesses that will provide significant help with the cost of coverage. Beginning this year, businesses with fewer than 25 workers and average wages of less than $50,000 will be eligible to receive a tax credit for the health insurance premiums they provide to their employees.  The smallest firms with the lowest wages will be eligible for the maximum credit, which is 35 percent of the cost of coverage, or 25 percent for non-profits. The credit will phase down for businesses with more employees and higher average wages. Businesses that are already offering coverage, as well as those opting to cover the workers for the first time, will be eligible for the credits. After 2014, when the new health insurance exchanges will be operating, credits will increase to 50 percent of the cost of coverage, or 35 percent for non-profits. Read the rest of this entry »