While the employer-based mandates have yet to kick in, the Affordable Care Act is already causing fear and uncertainty for all types of small enterprises.

“Businesses under 50 heads, which is the majority of small businesses, haven’t seen ObamaCare affect them in terms of decisions with their staff,” says Barry Sloane, CEO of Newtek, a health insurance agency for small businesses. “People are concerned whether or not they have the cash flow to hire more people. This slowness in the economy and the effects of ObamaCare are definitely putting a damper on business activity.”

Small business owners with more than 50 employees but less than 100 got a reprieve of sorts in February, when the government announced it would delay for another year the mandate for employees who work more than 30 hours a week to have employer-provided health insurance coverage (the first 30 employees are exempt, after that employers will pay $2,000 per uninsured worker). Businesses with 100 or more workers will need to start providing health benefits in 2015, under the ACA.

Even ahead of the mandates, some employers are already feeling pain from higher-priced renewals. According to Bonnie Evelyn, national practice leader of CBIZ Benefits & Insurance, business owners this year are seeing a 3% to 4% increase in their premiums on average.

In addition to climbing premiums, business owners say to them, health-care reform means a lot of confusion and complexity. For instance, Evelyn says there is a lot of confusion in terms of when and what business owners have to notify employees about the marketplace, and how they handle seasonal and variable employees in terms of health insurance.

“The cost will be significantly higher for businesses with a high number of part-time or seasonal employees, such as the retail or service industries,” said Evelyn in a recent blog post. “These are the groups that could be impacted significantly by the requirement to cover an increased number of employees.”  

According to experts, business owners have to spend time planning for the increased costs and do their homework so they fully understand the new rules under the Affordable Care Act. What’s more, Evelyn says ObamaCare is forcing business owners to take a hard look at the way they offer health coverage, which requires more time and planning, putting a burden on already taxed business owners.

One big consequence of the reform act and the increased costs associated with it, is a choice by many business owners to forgo insurance altogether and instead pay the fine, which can end up being less than the cost of purchasing insurance, says Sloane.  

“The Affordable Care Act is reducing the amount of dollars that people are spending on health care in U.S.,” says Sloane. “That trend is going to continue which is good because there is a tremendous amount of waste in the health-care system.”