Medicaid expansion helps small business

The news that the Virginia General Assembly voted last week to open Medicaid to an additional 400,000 low-income adults next year is great news for Virginians. While the residents who will now be eligible for Medicaid services appropriately receive considerable attention, this decision also bodes well for small businesses.

Let’s first consider what it means to be a small business in Virginia.

According to the United States Small Business Administration, small businesses comprise about 47 percent of the private workforce in Virginia and employ 1.5 million of its 8.33 million residents. Therefore, any policy that impacts small businesses affects a considerable percentage of businesses in the Commonwealth.

One important benefit of Medicaid expansion for small businesses is that it helps level the playing field in talent recruitment. Health insurance is more expensive for small businesses, so their health insurance packages are not as attractive as those of large businesses. This means small businesses are at a disadvantage when competing for workers. Also, the less generous health insurance packages small businesses typically offer do not promote a healthy workforce.

Medicaid expansion means people will have access to preventive care, which will in turn strengthen the health of the overall workforce. This benefit will disproportionately positively impact small employers, as they are not financially positioned to absorb the costs inherent to workers who forego preventive care now only to need costlier care later.

Another overlooked benefit of Medicaid expansion is that small businesses often operate on thinner margins, which makes hiring talented, yet health-challenged workers particularly precarious.

Virginia’s small business leaders can now focus on competing in a national marketplace with an even stronger workforce.

As the CEO of a Virginia small business that has had the pleasure of serving clients in 23 states in its more than 20 years of existence, I am excited to join my small business colleagues in demonstrating to our country how the Virginia business community’s strength just got a lot stronger.

René Cabral-Daniels, JD, MPH

CEO, Community Care Network of Virginia

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