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Rising Health Costs Push Small Businesses Toward Telehealth Solutions

As healthcare expenses continue to surge and the expiration of ACA Marketplace subsidies places additional financial strains on small businesses, many are opting to abandon traditional health insurance in favor of more affordable telehealth services.

The Impending Healthcare Crisis

Mooresville, United States, February 5, 2026 — This year sees an alarming projection where approximately 4.8 million individuals may find themselves uninsured due to the expiration of ACA Marketplace subsidies on December 31. This development is projected to cause significant spikes in 2026 insurance premiums, affecting small businesses the most severely. Reports indicate that premium costs could increase several-fold, creating a dire situation for many small employers.

The Small Business Dilemma

According to recent research from the Kaiser Family Foundation (KFF), nearly 48% of adults with ACA Marketplace coverage are either small business owners, their employees, or self-employed individuals. Notably, small business owners are three times more likely to rely on the Marketplace for their health insurance compared to other enrollees. With increasing costs, many small businesses are caught in a challenging predicament.

Small Business Owners Face Sudden Coverage Loss

Localized healthcare providers also feel the weight of these increased costs. Chiropractor Eric Frankenfeld and his wife, Lisa, who manages their office, recently decided to forgo their health insurance in 2026 after their ACA Marketplace premium skyrocketed from $340/month to an astounding $1,928/month.

“We are healthcare providers who cannot afford benefits. Oh, the irony. Purchasing a plan doesn’t make financial sense. We’re just going to cross our fingers and hope for the best,” Eric lamented.

Rick Cole, who operates Martinsburg Service in Martinsburg, WV, expressed similar frustrations, saying, “High healthcare costs for small businesses like mine have cost us employees, created challenges in hiring, and dramatically reduced our net profits!”

Kathy and Jeffrey Many, who run a garage door business in Brandon, Vermont, found themselves in a similarly dire situation, facing a shocking premium increase to nearly $2,670 a month from last year’s $625. “Being uninsured will be very nerve-wracking,” Kathy stated.

A Stark Reality: Less Than Half of Employers Offer Health Benefits

A recent national study from the Employee Benefit Research Institute (EBRI) indicates that only 49% of employers currently provide health benefits to their employees. This number is declining, particularly among small businesses, which are abandoning coverage rapidly as they grapple with these rising costs.

As industry experts project a 9% hike in costs for 2026, the average employer’s total healthcare expenditure per employee may exceed $17,000, marking the steepest increase in 15 years.

“If health insurance premiums rise faster than wages and overall inflation, small employers are likely to face intensified financial strain, which could drive many to eliminate health plan sponsorship altogether,” warned Paul Fronstin, Ph.D., Director of Health Benefits Research at EBRI.

Telehealth: A Viable Lower-Cost Alternative

In light of the ACA subsidy expiration and increasing premiums, many small businesses are shifting their focus towards telehealth options as a financially savvy alternative for their uninsured employees. Though these packages do not replace traditional health insurance, they address basic medical needs while supporting mental health, bolstering overall workforce stability.

With 24/7 access to care throughout the entire year, these telehealth plans promise to minimize missed workdays, increase productivity, and foster a healthier workforce.

Popular Subscription Models

Subscription-based telehealth models are gaining traction, allowing unlimited access to doctors and mental health professionals for a straightforward monthly fee, completely devoid of visit or usage charges.

Wendy Jordan, from Jordan Capital Consulting, which brokers one such plan, remarked, “When traditional insurance isn’t financially feasible, having a plan that costs $40 a month per employee can actually enable small businesses to maintain a baseline level of care for their teams and families.”

Wendy added, “We’re onboarding a growing number of business and trade associations, along with local chambers of commerce. They recognize the significance of making telehealth options available for their members, particularly as the demand for alternative insurance solutions continues to rise.”

AI legalese decoder: Navigating the Complexity

The introduction of AI legalese decoder can considerably lighten the burden on small business owners by simplifying the intricacies of health insurance contracts and telehealth agreements. This innovative tool can break down complex legal jargon, allowing businesses to make more informed decisions regarding their healthcare options. With clearer understanding, small businesses can choose the best plans that fit their budgets and employee needs without getting bogged down by complicated legalese.

For nearly half of the nation’s small businesses, the average $17,000 per employee for traditional insurance is simply out of reach. However, by exploring lower-cost virtual care models, employers can offer essential support, ultimately enhancing employee retention and fostering long-term business sustainability.

Contact Information

Name: Wendy Jordan
Email: Send Email
Organization: Jordan Capital Consulting
Address: 106 Langtree Village Drive Ste 301, Mooresville, North Carolina 28117, United States
Phone: +1-866-609-8671
Website: jordanconsulting.org

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