Melanie Shelley owns a hair salon in the 12th South neighborhood of Nashville.
As a small business owner, she has a myriad of issues to deal with and healthcare is at the top of her list.
Since she opened Trim Classic Barber and Legendary Beauty in 1998 she has provided a health insurance plan for her staff.
But she recently told Nashville's News 2 she could not longer afford it last year.
“Just last year it got to the point Blue Cross Blue Shield raised it 30% every year, year after year until we couldn't sustain it any longer,” she explained.
Many of her employees are now either without insurance, or paying for expensive plans on their own.
Shelley said she expects many of her employees will shop for insurance through the new federally operated private insurance marketplace.
“Right now, as a small business, our responsibility is to be the purveyor of information so people can go onto the Web site, find out what their options are,” she said.
Shelley's business is representative of what's happening with 70% of small businesses employing around 25 employees, according to Jim Brown with the National Federal of Business.
He says the cost of health insurance has been oppressive in the small group market and believes the Affordable Care Act will push the remaining small business owners, who still offer private insurance, to stop, which will send more workers into the federal insurance marketplace to shop for individual plans.
“You'll see a gradual move to the exchange. Nobody knows how quick it will be, but these larger employers, it's going to happen, these smaller employers that have 25 to 60 [employees], most still have health insurance. Eleven to 25 employees, there's been an exodus.”
Even though they won't be required by law, small businesses with 50 or fewer employees may get health coverage through the federal marketplace as well.
It's called SHOP, Small Business Health Options Program. This also includes non-profit organizations.
A business may qualify for tax credits if it employs fewer than 25 full time employees who make an average of about $50,000 a year or less,
Starting in 2014 the tax credit is worth up to 50% of a person's contribution toward employee's premiums. It is available only through SHOP.
That's something Shelley may consider, but for now she's holding off.
“We had a lot of hope with Obamacare that we'd be able to provide it in an affordable way and so far it's been very confusing and we are not sure with all the research we are doing if that's going to happen or not.”
Click here for more information on SHOP.