Small businesses get another year to comply with ACA

Insurance Commissioner Dave Jones called the new law
Insurance Commissioner Dave Jones called the new law "a victory for all California small businesses."
Rich Pedroncelli/AP

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A bill signed by Gov. Jerry Brown on Monday gives the smallest mom and pop businesses that provide health insurance to workers an additional year before they must comply with beefed-up coverage requirements under the Affordable Care Act.
Under the federal law, health insurance plans offered by employers must cover ten specified  "essential health benefits," including hospitalization, prescription drugs, maternity care and mental health treatments.

It's a provision that applies even to smaller mom and pops with fewer than 50 workers, which aren't otherwise required to insure employees under the federal health law's "employer mandate." 

But the newly-signed state law -- SB 1446 sponsored by State Sen. Mark DeSaulnier (D-Concord) -- now gives California's smallest businesses that choose to offer insurance to their workers until the end of 2015 before they must comply with those minimum coverage standards. 

The bill went into effect immediately. To qualify for the extension, a small business would have to have purchased health insurance for its workers by Dec. 31, 2013. 

"We think it will give small business owners a little bit of hope and a chance to breathe," said John Kabateck, California executive director of the National Federation of Independent Business. "Our big concern is how much time will that really be? A year can disappear very quickly."  

 Kabateck says his organization would have preferred an earlier version of the new state law that would have given small businesses with fewer than 50 workers three years – instead of just one - to make the transition to a health plan that complied with the Affordable Care Act. 

The California Chamber of Commerce, Small Business California and the California Restaurant Association also backed the bill, along with State Insurance Commissioner Dave Jones, who called its signing "a victory for all California small businesses."