Taking the Temperature of Small Business: Owners Say They Re Squeezed Between Soaring

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Taking the Temperature of Small Business:

Owners in OhioSay They’re Squeezed Between Soaring

Health-Care Costs and Going Uninsured

Cincinnati, OH(Dec. 14, 2007) – After pay, health insurance is the most important incentive small businesses use to recruit and retain employees. TheNational Association of Professional Employer Organizations (NAPEO) surveyed members’ clients in November and found that healthcare costs were their second-biggest concern after attracting employees. Yet more than half of the 365small businesses in a recent survey said their premiums rose as much as 10 percent this year.

Almost one in 10 businesses told the trade associationthey would discontinue their health coverage next year or are unsure about it. Many of these companies said they will pass at least some costs along to employees next year. One in five said they would raise co-payments for office visits or deductibles; one in four said they’d raise premiums.

“We have seen this coming for several years,” said Lisa Lickert, PHR, Director, HR Services at Employee Management Services (EMS) in Cincinnati, Ohio. “Soaring health costs hit small businesses especially hard, and these businesses employ the vast majority of employees. This is a difficult issue to deal with for small businesses and their employees, and the economy, as a whole, is affected by this issue.”

The Kaiser Family Foundation has reported that around 1996, more small companies began offering health benefits. Then from 2000 to 2005, the percentage droppedfrom 68 percent to 59 percent, however, that’s stabilized in the last two years. NAPEO’s survey revealed 71 percent will continue to insure their employees in the coming year – but another five percent remain unsure about continuing.

Professional employer organizations let small businesses outsource their complicated and time-consuming human resourcestasks, such as overseeing payroll functions or administering health benefits, so owners can focus on making a profit. In addition, PEOs’ experience in the healthcare market and pooled programs help small businesses fight the raising costs of healthcare.

To review the NAPEO survey report, go to

EMS is an Ohio-based human resource company that was established in 1994 as a division of CBS PersonnelServicesLLC, which is held by a publicly traded company. They provide services to over 200 clients and 4,600 client employeesin the Midwest. For more information on the company, visit

For more information on NAPEO and PEOs:

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