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Economist: Recovering Montana businesses to face health reform effects

2013-02-02T13:49:00Z 2013-02-02T14:10:49Z Economist: Recovering Montana businesses to face health reform effectsBy JENNA CEDERBERG Missoulian Helena Independent Record
February 02, 2013 1:49 pm  • 

MISSOULA — As the Missoula economy creeps into recovery mode after the Great Recession, everyone from business owners to government officials to employers must begin preparing for the drastic changes health care reform will undoubtedly bring.

“2014 is going to be the sea change year, that’s when so many elements of the act become implemented and will hit the ground. It will affect all parts of society,” said Larry White, director of the University of Montana’s Western Montana Area Health Education Center.

White was the keynote speaker at the 38th annual economic outlook seminar – “The Best Medicine: How Can Montanans Take Charge of Changes in Health Care?” – presented by the University of Montana’s Bureau of Business and Economic Research.

White reminded the audience that while some sweeping mandates from the federal Affordable Care Act already have been enacted, the major stipulations, including the employer-provided insurance mandate for businesses with more than 50 full-time employees, will take place in 2014.

The unsustainable rise of health care costs made reform necessary, White said.

In Montana, health care spending has grown by 7 percent since 1991. Nearly 20 percent of Montanans are uninsured, including almost 19,000 Missoula County residents. So insurance companies have had to pass on the expense of unpaid medical bills and charity care to insured patients.

While the reform won’t solve all the nation’s health care problems, it could help, as many more Montanans will gain health care insurance, White said.

“The opportunity to reduce uncompensated care costs would really benefit all our society, in some relatively drastic ways,” White said.


The Affordable Care Act also mandates that each state have an insurance exchange, which White described as an “online marketplace for individuals and small employers where they can shop for insurance.”

The exchange could help create more “prudent” buyers, by allowing private consumers to play a bigger role in choosing their plans.

White also noted that by 2016, employers with fewer than 100 employees would be able to purchase insurance on the exchange, which would increase their buying power.

Making sure business owners are educated and prepared for changes is crucial to making reform worthwhile, White said.

“The takeaway here is that there are so many nuances and implications for employers that it behooves the employers to seek good consultation now,” he said. “It’s very important for small business to get good advice on what choices they want to make, as far as providing insurance for their employees.”

Businesses should consult more than just their insurance agent, White said.

“Generally, it’s your certified public accountant or business adviser” who can help with tax implications and other issues, White said.


Before White spoke on Friday, Paul Polzin, director emeritus at the Bureau of Business and Economic Research, told the audience that in 2012 Missoula’s economy saw slight growth that suggested it’s climbing out of the recession.

However, Polzin also said that Missoula County’s economic growth was the slowest of any major urban area in the state. Declines in the wood products and paper industries, such as the closures of the former Stimson Lumber and Smurfit-Stone Container mills, continue to affect the economy, Polzin’s reported.

“The University of Montana and other state agencies are now the largest basic industry, and are roughly three times larger than wood and paper products,” the report said.

Bright spots include the expansion of the Aluminum Company of Maine Inc. here and an end to the state employee wage freeze. The Missoula economy is projected to grow 2.4 percent per year through 2016, the report said.

Statewide, economic growth was stronger than expected in 2012 and that stronger growth is expected to continue, Patrick Barkey, director of the BBER, wrote in his Montana economic outlook report.

Growth will continue if oil prices remain high enough to support new or nearly completed investments, commodity and agriculture prices remain steady, and there is a gradual improvement of new home construction.

Copyright 2015 Helena Independent Record. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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