The younger and healthier a small business's workforce, the greater its chances of facing a big spike in health-insurance premiums next year.
That is because the Affordable Care Act's impact on small employers will split largely on generational and industry lines, putting entrepreneurs like Eileen Hasson, owner of a technology-services firm with mostly male employees in their 20s and 30s, at a disadvantage.
Starting in January, insurers will no longer be able to set premiums for small-group plans—which apply to employers with fewer than 50 or 100 employees, depending on the state—based on a firm's industry or the health or gender of its staff. Insurers will still be able to take into account the age of a firm's workers, though to a lesser extent, and whether or not those people use tobacco.
The result: the cost of health care will be more evenly spread among small businesses, as employers with mostly young and healthy workers pick up the costs of firms that comprise the opposite. The rebalancing will drive up premiums for some companies in industries with lots of young, healthy workers, such as technology, while moderating rate increases for firms with older and sicker workers, and in higher-risk industries such as industrial manufacturing.