Two Dallas-based experts had 10 takeaway tips for employers at a recent SouthWest Benefits Association meeting in north Dallas on complying with the 2014 changes in the Affordable Care Act. The panel included Jake Barney, an attorney with the Dallas law firm Locke Lord LLP, and Christopher Beinecke, a senior consultant in the Dallas office of Towers Watson. Here are 10 takeaways from that presentation:
- It is important to distinguish potential penalties. The $2,000 penalty is for companies with at least 50 employees who do not offer health benefits to workers and have at least one employee receive a premium tax credit. The penalty is assessed annually for each employee after the first 30 employees. The $3,000 penalty is assessed if the employer does not offer insurance that covers at least 60 percent of health care expenses or costs more than 9.5 percent of family income.
- The number of employees considered for potential penalties are based on the previous year’s workforce count.
- For 2014, employers with at least 50 employees must offer coverage to at least 95 percent of their workforce to avoid the $2,000 penalty. After 2014, coverage also must be offered to the employee’s dependents. Thus far, spouses have been excluded and it is unclear whether that was intentional.
- Maximum incentives for outcomes-based wellness programs will be increased from 20 percent to 30 percent in 2014. That rises to 50 percent for tobacco cessation programs. Beinecke pointed out that many companies might not offer tobacco cessation because of the “challenging” return on investment and low quit-rate success.
- The Health Insurance Portability and Accountability Act (HIPAA) has long required health plans to offer alternative standards outcomes-based wellness activities if it was medically ill advised. The new regulations change this to anyone who fails the measurement, test or screening—thus taking physicians out of the process. Barney said there was a lack of Americans with Disabilities Act (ADA) guidance, other than the fact that HIPAA compliance was not the same thing as ADA compliance.
- Beinecke said businesses only have to track the hours of employees who clearly are not part-time or full-time. He urged businesses to do so at least on a spreadsheet—if not formally—because it can translate into millions of dollars of expense for larger companies.
- The initial measurement period for determining whether a new employee is eligible for benefits is 3-12 months, followed by a 90-day administrative period.
- The measurement period can vary based on demographic factors such as geography and union status.
- The individual mandate applies only to legal residents of the United States. Beinecke said he has clients who are considering sending jobs offshore because of this.
- The comment period for the ACA, “pay or play” penalties were issued Dec. 28 and the comment period ended March 18.
Steve Jacob is editor of D Healthcare Daily and author of the new book Health Care in 2020: Where Uncertain Reform, Bad Habits, Too Few Doctors and Skyrocketing Costs Are Taking Us. He can be reached at [email protected].
