1. By Tom
Paplaczyk
Co-founder/Partner
Strategic Business
Services Agency
The Affordable
Care Act (ACA)
became law on March 23,
2010. As we approach the 6th
anniversary of the passing of
this law, we continue to discover
and deal with its far reaching
influence on your business or
organization, not to mention
individuals who purchase their
own insurance. The Affordable
Care Act, like most laws that
are passed, has some positive
elements and arguably negative
aspects as well.
On a positive note, individuals
who in the past were unable to
find insurance to cover a serious
health condition can not only
get coverage, but assuming they
act(ed) within the timeframes,
but also received immediate
coverage for those pre-existing
conditions. Many not only
received this coverage, they also
received financial assistance
to help pay their premium and
in some cases reduced their
out of pocket expenses, all
based on Federal Poverty Level
Household Income levels. This
positive impact has been offset
by increasing deductibles and
premiums for those who were
insured and are reasonably
healthy. In some cases, the
new cost doubled or tripled! In
addition, individuals are finding
out that if they didn’t have
coverage that met minimum
requirements under the law,
their 2015 tax return reflects a
hold back or balance due for not
complying with this provision
of the law. Finally, employers
are now required to report
whether they offered coverage
to their employees, and whether
or not it is qualifying coverage!
Along the way, there have been
many changes and delays to
implementation of this law.
As a veteran benefit consultant
and proactive owner, I share the
following observations with you.
As insurers
grapple with
providing
competitive
products
that comply
with the ACA
requirements,
several trends
are developing.
It is necessary
to look at how
employers view
their offering
of health
and ancillary
benefits.
Employers
who need to
attract and
retain highly educated or highly
skilled employees as a necessary
component of their business
model strive to create attractive
plans that are as cost-effective
as possible. The other side of this
coin is employers who have not in
the past offered benefits and are
finding it necessary to do so. They
typically will buy the lowest-cost
plan and charge their employees
as much as they are able, with
the goal of minimizing their
costs while complying with the
law. Where on this scale is your
business or organization?
Insurers have also reviewed
the law and found exceptions or
“loopholes” that employers can
exploit to provide better coverage
than ACA plans, at a lower cost,
with integrated wellness and
other incentives for employees.
They use the same type of
funding and benefit strategy large
companies use, simply put, a self-
funded or level-funded plan.
These plans have the following
features: guaranteed fixed
premiums, even if group has
excessive claims; opportunity
for premium refund if claims
are below target; embedded
telemedicine and wellness
programs; claim reports to see
how the plan is being used.
The biggest advantage of these
plans is that the plan designs
and pricing can be significantly
lower because the plans take into
account the demographics and
health of the group.
The Central Ohio Chamber of
Commerce is offering, through
the local Worthington Chamber
and other chambers in central
Ohio, a hybrid plan that allows
healthy groups to obtain better
rates than the ACA rates, in a
shared pool of risk, call a MEWA.
The Southern Ohio Chamber
Alliance (SOCA) developed this
plan over the past few years
and it will be available to new
chamber clients starting in May
of this year. This product will be
available to groups with as few
as two employees, and is going
to provide an additional option
for small businesses to provide
valuable healthcare benefits to
their employees.
Finally, the reporting and
compliance requirements of the
law are driving an integration
of payroll, time and attendance
and benefit administration onto
single platforms so employers can
improve benefit communication
to employees, administer the
benefits efficiently, track part-time
employees’ hours to calculate
eligibility of employees for
benefits (50 or more employees),
and then provide reports the IRS
requires concerning the offer
and acceptance of coverage by
employees. Benefit consultants
are scrambling to partner up with
payroll providers to offer these
services.
Our agency, as an example, has
offered payroll services for our
clients for more than 10 years.
In the past year, our product has
developed to the point where it
incorporates all of the functions
on a seamless platform and
competes exceptionally well with
traditional payroll only providers.
The changing world of
healthcare, benefits, human
capital management are
challenging to most businesses
and organizations. Developing a
partnership with a consultant or
trusted advisor who is up-to-date
on the laws and changes to them
is instrumental to the success of
any business.
ar
Affordable Care Act drives benefits and
technology integration, new plan options
The changing world of healthcare, benefits,
human capital management are challenging,
developing a partnership with a consultant
or trusted advisor who is up-to-date on the
laws is key to the success of any business.