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Small business owners, employees worry about higher health insurance costs
Rachel LaCasse-Ford, right talks to Sen. Tammy Baldwin about her use of the Affordable Care Act marketplace to buy insurance during a meeting Baldwin held with small business owners and others in Mount Horeb, Wisconsin, on Sept. 25. (Photo by Erik Gunn/Wisconsin Examiner)
Matt Raboin owns Brix Cider, a farm-to-table restaurant, and brews apple cider in the Dane County village of Mount Horeb.
His wife’s full-time job with benefits provides the family with health insurance, but for Raboin, the Affordable Care Act (ACA) has made an important difference for some of his employees.
Federal fallout
As federal funding and systems dwindle, states are left to decide how andwhether to make up the difference.
“We don’t offer insurance ourselves,” Raboin said during a recent round table discussion set up by Sen. Tammy Baldwin (D-Wisconsin). “A lot of small businesses in small towns aren’t in a financial place to do that.”
Like Raboin, some of his employees get their coverage through a spouse or because they also work another full-time job that provides benefits. But over the years, the ACA and the HealthCare.gov marketplace created under the law have been a critical source of health coverage for many of his employees, Raboin said.
Recently he polled a number of them. One memorable response came from a part-time employee who also has a part-time job with a local church. She buys her health insurance on HealthCare.gov. Thanks to an increase enacted in 2021 in tax credit subsidies, she’s been able to afford the premiums, Raboin said she told him.
“So without it, she’s like, ‘I can’t keep working for you. And I don’t think I keep working for my church. I think I have to find a different job,’” Raboin recalled.
The ACA and HealthCare.gov have made it possible for millions more Americans and thousands more Wisconsin residents to obtain health insurance.
But less visibly, the health care marketplace that the ACA created has also helped support many small businesses. If the enhanced tax credit subsidies that lowered the cost of health insurance for millions over the last three years aren’t renewed, small business owners and employees say they could be especially hard hit.
Nearly half of people who get their health insurance through the HealthCare.gov marketplace are self-employed or small business owners, or else work for small businesses, according to KFF, an independent nonprofit that researches and reports on health policy.
To expand access to health care, the ACA created the HealthCare.gov marketplace to make buying health insurance easier for people whose jobs don’t provide coverage and who don’t qualify for government programs such as Medicaid.
To make coverage more affordable, the law provides tax credit subsidies for people with incomes up to 400% of the federal poverty guideline. Those subsidies were increased in 2021 and expanded to people with higher incomes.
The enhanced subsidies will expire at the end of 2025 unless Congress extends them — driving up the cost of health insurance for millions.
The enhanced subsidy “saves more than 230,000 Wisconsinites an average of $500 every single month,” Baldwin said during a Zoom press conference Tuesday.
For Chrysa Ostenso and her late husband, the enhanced subsidies lowered their premiums from nearly $2,000 a month to about $300 a month, Ostenso said.
Ostenso lives in Ladysmith, Wisconsin, where she and her husband operated an optometry clinic for more than three decades, raising four children along the way.
“We always struggled to afford health insurance but of course we had to buy it,” Ostenso said in an interview. “As a family of four kids with a small business, you can’t go without health insurance.”
The family’s high deductible plans required them to pay $6,000 a year out of pocket before insurance would cover their health care. By 2020, when the children were grown and the health plan just covered Ostenso and her husband, they were paying $1,979 a month, she said.
They hadn’t qualified for the original ACA subsidies. When the enhanced subsidies were enacted in 2021, however, Ostenso said their premiums went down to $300 a month, increasing to $500 a month in subsequent years.
“It actually meant freedom to go to the doctor, because we were spending so much money on our premiums [previously] that we actually couldn’t afford to go to the doctor,” she said.
Standoff over extending subsidies
In the weeks leading up to Tuesday night’s federal shutdown, Democrats in Congress demanded that Republicans rescind sweeping changes to Medicaid that were part of the major tax- and spending-cuts megabill that President Donald Trump signed July 4.
They also demanded an extension of the enhanced ACA subsidies.
Baldwin has coauthored legislation that would make the enhanced subsidies permanent. She spent part of the just-concluded congressional recess traveling Wisconsin and meeting with people who expect to see their health costs go up sharply if the increased subsidies end.
During Tuesday’s press conference, Baldwin related a conversation with a bakery owner who worried about how she and her family will afford health insurance, “but also that increased costs on the [HealthCare.gov] exchange will mean that her employees at her bakery may have to quit to work for big companies that offer insurance.”
During Baldwin’s press conference, Gigi Gastevich, an artist who owns a retail space in Stoughton, said the ACA and the enhanced subsidies had made it possible for her to launch and grow her business.
Gastevich is a 15-year cancer survivor. When starting her business, she qualified for BadgerCare — Wisconsin’s main Medicaid program — which covered the ongoing medical monitoring she requires as a cancer survivor.
In 2025, with her income above the limit for BadgerCare, she found an insurance plan on HealthCare.gov that included her existing health care professionals in its network and had an affordable deductible.
The plan’s premium was $481 a month, Gastevich said, but the enhanced subsidy brought it down to about $100 a month.
Without the subsidy, she said, she will have to switch plans — possibly losing her long-standing group of providers if they aren’t in the network. She said her choices include taking a high-deductible plan that would put some of the regular care she’s been recommended as a cancer survivor out of reach financially; or closing down her business.
“[That] would mean not only abandoning my dream of entrepreneurship and being a self-employed artist, but taking away an income source for the dozens of artists and artisans whose American-made work I sell here,” Gastevich said.
It would also forestall her plans to scale up her business to sell her own line of textiles and employ others. “I won’t be able to do that if my health and well-being is tied to being on an employer-based health care plan,” she added.
Uncertain future
During her tour of the state, Baldwin stopped in Mount Horeb on Thursday, Sept. 25, where she spoke with Brix owner Matt Raboin and four other business owners as well as local health care providers.
The round table took place at the Upland Hills Health Mount Horeb clinic. The urgent care clinic is part of a broader system that includes a hospital in Dodgeville and clinics in surrounding communities.
Dr. Mark Thompson, Upland Hills CEO, said system executives expect to see about $400,000 a year in additional uncompensated care based on projections of people leaving the insurance rolls because they don’t think they can afford the new ACA premiums.
Jay Goninen sat in as a board member of the Upland Hills system, but he’s also an employer for whom the ACA has made it possible to provide health benefits.
Goninen owns a business that helps connect the auto repair industry with high schools and technical schools. For the last few years, he’s opted to have employees of the firm purchase health insurance on the ACA.
The company pays a portion of the cost. Goninen likens the arrangement to a common practice of employers who offer a group health plan and split the cost with their employees.
“I do really worry about just the individual person and their ability to afford to live right now, in general,” he told Baldwin. “It is tough.”
In addition to worrying about what will happen to employees who bought coverage at HealthCare.gov if they lose their subsidies, Raboin said he’s also concerned about the broader ripple effect in the community.
“Our clients aren’t rich,” Raboin said. “Not everybody can go out to eat all the time, and if you start taking away that expendable income, that’s less people coming out to eat. So I think it would depress the whole economy.”
Rachel LaCasse-Ford owns a campground with her husband and also heads the Mount Horeb Chamber of Commerce.
“I’ve never really had a job that offers health care,” LaCasse-Ford told Baldwin. “I’ve always worked in small business, so we have always used health care from the ACA.”
The enhanced tax credits “definitely benefited” the couple, she said. “And if those go away, that will make our budgets tighter, and it will make things more challenging for us.”
With every new job, LaCasse-Ford said, she considers its impact on their health coverage and whether she can stay with a nonprofit employer such as the chamber, work for a small business, “or if I need to look for a larger employer that offers benefits.”
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