Employers Prepare for Affordable Care Act
September 26, 2013 — The Lakeshore Chamber of Commerce hosted a panel of five health industry experts and Indiana State Representative Mara Candelaria Reardon for its Ninth Annual Business Expo.
400 Chamber members packed into the Dynasty Banquet Center in Hammond and listened as the panel discussed how both people with and without insurance will fall under the Affordable Care Act.
CliftonLarsonAllen, LLP partner Beth Auterman said people who take advantage of employee-sponsored plans will see few changes, “The sponsored plan is going to be monitored closely under the act. Basically, the two key items that are going to be looked at that could cause an employer to pay penalties because of their plan is affordability. The plan has to be affordable for their employees. There is a safe harbor out there of nine and a half percent of their W-2 wages. If premiums are under that, the plan is considered affordable.”
Businesses have a couple of options for employees who are not covered.
Will Glaros, President and CEO of Employer Benefits Systems, Inc. said three such options exist.
“You can look into purchasing a small group health plan for your employees. Two, you can decide to not offer a plan, but allocate resources to provide them the money they need to go out and buy coverage. It’s going to be an after tax type event so it’s not as attractive as if you do it through a group plan. And if you even offer a small group plan there may be people if that plan is not affordable, according to the law, they would qualify for federal subsidies which would reduce the cost of that coverage,” said Glaros.
Auterman said some full-time employees will opt to go through the exchange, also called the federal government marketplace. They may also collect federal subsidies if they don’t feel the employer sponsored insurance covers what they need. Auterman also said companies will pay a penalty for those full-time employees.
Some businesses are making changes to avoid the additional costs a full time employee can create. “The Affordable Care Act defines full-time employees of 30 hours or more. Some companies are actually choosing to drop the hours of their employees to below 30 hours so that they’re not considered full-time employees,” said Auterman.
Methodist Hospitals President and CEO Ian McFadden said since the Affordable Care Act is designed to give people access to providers, his emergency rooms should not be as burdened. Many of those patients would be better off with private doctors.
McFadden said he hopes that employers begin to educate their employees, “We’re going to have a lot of questions. They have questions about coverage. There was a question about are mammograms covered. That’s a good question. These exchanges may have some limitations and we don’t know what all that is.”
McFadden said there are only three exchanges in the state, Anthem, MDWise and MHS Healthcare. Of those, only two exist in Lake County, Anthem and MDWise.
“Each exchange has three different plans to it, a bronze, silver and a gold plan. We need to understand what’s included in all those. What’s the difference there? Depending on what a person wants to buy may determine what they have covered as well,” said McFadden.
To help understand the process, navigators will be available at hospitals and federally qualified health centers to answer questions. Individuals can also visit www.healthcare.gov.
By: Renetta DuBose