How One Policy Could Wreck Your Business Sale

TL;DR:

A new national survey shows that 87% of small business owners want Affordable Care Act (ACA) tax credits made permanent, and 84% say losing them would cause severe financial strain. Health-care costs are one of the most overlooked levers in small business valuation, exit planning, and acquisition strategy. Buyers and sellers who get ahead of this change will gain real financial leverage — the rest will lose margin.

The Hidden Cost Shaping Every Small Business Sale

For most small businesses, health-care costs aren’t just a line item — they’re a deal-breaker.

A recent survey by Small Business for America’s Future found that rising health-care premiums are one of the top three financial pressures facing small firms in 2025.

And the threat is real: if ACA premium tax credits expire, millions of owners and employees could face double-digit cost increases overnight.

“Without those credits, 84% of small businesses expect major financial strain,” the report notes.

That strain translates into lower cash flow, weaker valuation multiples, and less flexibility for both buyers and sellers in deal negotiations.

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Why Buyers Should Care

If you’re evaluating a potential acquisition, benefit costs are a hidden gold mine for improving profitability after close.

Here’s why:

• Every 1% reduction in benefit costs can increase EBITDA by thousands — especially in service-heavy businesses.

• Employers who restructure coverage or offer Health Reimbursement Arrangements (HRAs) can often cut premiums 20–30% while maintaining coverage.

• Buyers who model these savings gain leverage in valuation negotiations. You’re not just buying a company — you’re buying the inefficiencies you can fix.

Pro tip: Before closing any deal, ask to see the company’s most recent Form 5500 filings or health-plan cost summaries. You’ll quickly see where the drag is.

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Why Sellers Should Act Now

If you’re planning to sell within the next 12–24 months, don’t wait to optimize. Rising premiums or lost ACA credits could shrink your SDE (Seller’s Discretionary Earnings) and reduce your asking price.

Action steps for sellers:

1. Benchmark your benefit spend against national averages (KFF Employer Health Benefits Survey).

2. Shop alternative plans before renewal season — many PEOs and small-group pools can lower rates 15–25%.

3. Document savings in your financials. Buyers pay more when they can see stable, predictable expenses.

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The Policy Wild Card: What’s Next

Congress has yet to make the ACA premium tax credits permanent, and small business advocates are pressing hard.

You can follow live updates through:

• Small Business for America’s Future Press Room

• U.S. Small Business Administration Policy Updates

• Healthcare.gov Newsroom

Whether the credits are extended or not, the winners will be those who act — not those who wait.

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The BusinessOwner.com Take

At BusinessOwner.com, we teach buyers, sellers, and brokers how to spot these shifts and turn policy changes into profit strategies.

If health-care costs are squeezing your margins — or you’re preparing to sell — now is the time to analyze your numbers and act.

👉 Certified Buyers: use our upcoming Deal Evaluator GPT to stress-test benefit costs in your target businesses.

👉 Agents: add this to your next client conversation — it’s the kind of insight that builds trust and closes deals.

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