The health-care and social assistance industry is comprised of physicians, dentists, chiropractors, mental health practitioners, physical therapists, retirement homes and child day-care services, among many similar professions. While many people who work in this industry are employed by huge organizations — think Kaiser Permanente and its 18,000+ physicians around the country — some are self-employed small-business owners who have set up their own practices.
Small-business owners in the health-care and social assistance industry are more pessimistic than most; their Small Business Confidence Index score of 55 is the lowest of any individual industry and five points lower than the overall average.
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In the survey, 44 percent said they expect that changes to government regulations will have a negative effect on their businesses in the next 12 months — much higher than the 26 percent of small-business owners overall who say the same. This uncertainty regarding potential regulatory changes is likely one cause driving down confidence for these small-business owners.
The possibility of regulatory changes, including those regarding Medicaid, is cited by 28 percent of small-business owners in the health-care and social assistance industry as the most critical issue currently facing their businesses. In no other industry does worry about regulatory change come close — most other small-business owners are much more concerned about taxes than regulations.
Not that everything is rosy for the broader group of small businesses with the current health-care setup: For small businesses with 50 or more employees, the very ones who faced the stiffest penalties for not providing health care under the ACA, providing health care is the No. 1 issue. By contrast, the fewer employees a small business has, the more apt they are to call out customer demand as a critical issue.
All of this negativity has a real effect on business owners' outlooks. Only 45 percent of small-business owners in the health-care and social assistance industry expect revenue to increase in the next year, compared to 55 percent of all small-business owners.
The health-care industry is highly regulated, but it is not unique in that sense. The finance and insurance industries, for example, also face complicated regulations that were introduced or strengthened during the Obama presidency. However, the plans put forward by the Trump administration are largely expected to ease regulations. As a result, small-business owners working in finance and insurance are optimistic about changes to regulations in the next year: 43 percent say that any regulatory changes will have a positive effect on their businesses, and only 27 percent expect it to have a negative effect.
The current debate on changes to health-care regulation is focused on improving coverage and reducing costs — and very rightly so. But any reforms that are made will undoubtedly influence the fates of small businesses, including those in the very industry that is being overhauled.
— By Jon Cohen, chief research officer; and Laura Wronski, survey research associate at SurveyMonkey