Archive for April, 2013

Affordable Care Act – Unsure of Personal Impact

The majority of Americans are still unsure how the Affordable Care Act (ACA) will impact them. These are the findings from Kaiser Family Foundation’s March 2013 Health Tracking Poll. Here are the highlights of the March poll.

Affordable Care Act – Unsure of Personal Impact

According to the poll, two-thirds of the uninsured and a majority (57%) of Americans overall say they have too little information to know how the Affordable Care Act will impact them.

How ACA Will Impact Americans

Affordable Care Act – Unaware of Medicaid Expansion & Insurance Marketplaces

Generally, the public is not aware or knowledgable on the decisions states are making about ACA Medicaid expansion and establishing state insurance marketplaces. The poll found 78% did not know enough about their state’s decision to participate in Medicaid expansion, and 48% knew nothing about their state’s decision for the health insurance marketplace.

ACA Exchange Information

 Affordable Care Act – Favorable/Unfavorable

According to the poll, the country remains fairly evenly divided on the ACA, with 40% holding an unfavorable view of the law and 37% holding a favorable one.

How ACA will impact americans

Affordable Care Act – Future Personal Impact

Looking ahead, the public’s expectations about ACA’s likely impact on their own families tends to be more negative than positive, with 29% saying the ACA will make them worse off, 21% saying it will make them better off, and four in ten saying it won’t make much difference.

ACA Impact on Americans

Affordable Care Act – Most Popular Provisions

The most popular provisions of the ACA, including tax credits to small businesses and the closure of the Medicare drug coverage gap known as the “doughnut hole,” remain among its least widely recognized, while the law’s least popular provision, the individual mandate requiring most people to obtain health coverage, is its most widely recognized.

ACA Impact on Americans

Read the full Kaiser Family Foundation Health Tracking Poll here.

Posted in: Business Insurance, Health Care Reform (ACA), News You Can Use, Personal Insurance

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The Affordable Care Act – It’s Time to Start Counting Hours

Melissa Weaver and Julie Song -Triad Business Journal

April 4, 2013

The 2010 enactment of the Affordable Care Act (“ACA” or the “Act”) ushered in an enormous social reform effort aimed at improving the nation’s health care system through a series of mandates, premium subsidies, and taxes. Although the full impact of the Act will not be known for years to come, its intended goals were to expand health insurance coverage and to reduce costs.

After much discussion and debate, as well as legal challenges all the way to the U.S. Supreme Court, implementation of the ACA is upon us. As a result, employers must comply with the Act’s myriad requirements, the most significant of which become effective on January 1, 2014. Regulatory guidance is pouring forth, and it is not too early for employers to determine how the rules of the Act apply to their businesses. In fact, employers with calendar-year plans may want to take action as soon as next month.

Where we are today and preparing for 2014. Many provisions of the ACA have already taken effect. Still, for most employers the most significant aspects of the Act are on the horizon beginning January 1, 2014 – including the individual mandate, employer shared responsibility provisions (including the provision of minimum essential health coverage that is affordable), and the establishment of health exchanges (insurance marketplaces to facilitate individuals’ and small businesses’ purchase of health insurance meeting certain benefit and cost standards).

Individual Mandate.Beginning in 2014, the ACA’s individual shared responsibility provision, or individual mandate, requires that individuals have basic health insurance coverage, qualify for an exemption, or pay a penalty initially set at $95 per person or 1% of income, whichever is greater. The effect of the Act on sole proprietors will be much like the impact on individuals with respect to the individual mandate. As a one-person business, subject to certain exemptions, a proprietor can buy insurance through an exchange scheduled to roll out in 2014.

Employer Play-or-Pay Mandate. For employers with employees, the Act’s shared responsibility provisions – known as the “play-or-pay” mandate – are complicated and require careful review and application of the detailed rules. Under the play-or-pay provisions, “applicable large employers” that employ an average of at least 50 full-time employees on business days during the preceding calendar year will be required to provide certain minimum levels of health coverage to “substantially all” of their full-time employees and their dependents or else pay a penalty. In calculating the penalty, the first 30 full-time employees do not count toward the computation.

For a large employer that does not offer coverage and any full-time employee receives subsidized coverage – i.e., a premium tax credit or cost-sharing reduction – in a health plan through an exchange, the penalty is $2,000 per all full-time employees per year.

For a large employer that does offer coverage but the coverage is considered not “affordable” or does not provide “minimum value”, and any full-time employee receives subsidized coverage in a health plan through an exchange, the penalty will be the lesser of $3,000 per full-time employee who actually receives a subsidy, or $2000 per all full-time employees per year.

Coverage is considered “not affordable” by any full-time employee if the premium for employee-only coverage is greater than 9.5% of the employee’s household income, as measured by the income reported in Box 1 of Form W-2. The coverage does not provide “minimum value” if the plan pays less than 60% of the expected costs under the plan.

Identifying Full-Time Employees. Large employers may choose to offer coverage to all of their employees, both full-time and part-time, thereby avoiding the issue of which employees qualify as full-time employees. However, many employers will need or desire to provide health coverage only to full-time employees. Thus, the identification of the employer’s full-time employees becomes critical for purposes of determining whether to play-or-pay.

Full-time employees are defined as those who work more than 30 hours on average per week. Complex rules have been proposed, and can be relied upon, to identify these employees and determine if they must be offered coverage. The rules address how to treat current employees, new hires, seasonal employees, students and interns, those who go from full-time to part-time and vice versa, etc. Employers who do not want to offer coverage to part-time, seasonal, or other “variable hour” employees will need to begin planning now for 2014.

The regulations require that employers classify their employees as full-time or part-time based on their actual hours during a prior look-back period. If an employee is paid by the hour, an employer can easily determine how many hours they worked. For employees who are paid on a salaried basis, employers have several methods available to determine whether those employees worked at least 30 hours per week, including counting actual hours worked or using one of two equivalency methods.

If an employer hires employees whose schedule will vary, or who will be seasonal employees, they will need to determine if such employees will regularly work 30 hours per week on average. The regulations under the Act provide a method for making these determinations using a pre-determined look-back period to count the employee’s hours worked, and an additional administrative period to offer the coverage to the employee and complete the enrollment process. The look-back period is selected by the employer, and can extend from 3-12 months. The administrative period can be up to 90 days in length. Once the full-time employees are identified, the regulations prescribe the length of time those employees must be offered health coverage, and when their status as full time employees can be re-evaluated.

Employers Must Act Now. Full-time or part-time classification in 2013 will drive the play-or-pay requirements for 2014. Employers who plan to use a 12-month look-back period going forward may use a transition rule that allows a six-month look-back period during 2013 to determine which employees will be considered full-time for all of 2014. Employers with a plan year beginning on January 1, 2014, should begin counting employee hours in April of this year if they would like the maximum permitted time to make these full-time employee determinations. Employee hours can be counted during the six-month period between April and September 2013, and the employer can use a 90-day administrative period between October and December to notify employees, handle enrollment, and have all eligible full-time employees enrolled and receiving coverage on January 1, 2014. Employers with a plan year beginning later in 2014 will have a little more time to start counting hours, but all employers should begin planning now so as to be able to use all the time allowed if needed.

Identifying whether employees qualify as full-time for purposes of the ACA can be complicated for employers with employees who work variable hours or seasonally, or for those with frequent turnover. The length of the look-back period chosen impacts the length of time the employer must offer such employees health coverage before their full-time status can be re-evaluated. Employers should consult with their legal and benefits advisors if they need assistance in making these determinations.

Posted in: Business Insurance, Health Care Reform (ACA), News You Can Use

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Survey: Most Small Businesses Concerned About Healthcare Law

The Hill By Vicki Needham –

April 4, 2013:

A majority of small businesses say the healthcare law is their biggest concern, finally eclipsing their long-held worry over economic uncertainty.

The U.S. Chamber of Commerce’s latest quarterly small-business survey finds that 77 percent say the Affordable Care Act will make coverage for their employees more expensive, while 71 percent say it will be harder to hire more employees under the law.

Of those surveyed, 79 of small businesses believe the economy is on the wrong track.

“While the general trends of the economy appear to be improving, a closer look shows workforce participation still falling and full-time employment still historically low,” said Dr. Martin Regalia, the Chamber’s chief economist said on Thursday.

About one-third of small businesses say, in response to the healthcare law, they plan to cut back hours to reduce the number of full-time employees to avoid qualifying for the employer mandate.

In addition, 32 percent of small businesses plan to reduce hiring because of the mandate. That would likely affect many firms with right around 50 employees.

“In today’s economy, we need policies that will breed confidence and encourage small businesses to expand, not cut back staff and employees’ hours. With the right policies in place, small-business owners’ optimism and confidence in the economy will improve,” Regalia said.

Small businesses are looking to Congress to lead on policies like increased energy production, comprehensive tax reform, removing government barriers and immigration reform.

Eight out of 10 small businesses support comprehensive tax reform and 52 percent said the tax code should be simplified.

A clear majority (84 percent) says that regulations, restrictions and taxes negatively effect their ability to do business.

Two-thirds of respondents said that immigration reform would increase the nation’s global competitiveness and help strengthen the economy.

Amid debate over the nation’s inflated debt levels, 78 percent of small businesses said they view the debt and deficit as a threat to the success of their business.

They also squarely put the onus on Senate Democrats for failing to bolster economic growth.

The survey showed that 86 percent of small firms disapprove of Senate Democrats compared with 46 percent who disapprove of the House Republican majority is doing.

The survey was conducted online from March 14-26 of more than 1,300 small-business executives.

 

Posted in: Business Insurance, Health Care Reform (ACA), News You Can Use

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