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Health care reform: What employers must do
March 21, 2011 - Mary Ann Heath
Individuals are not the only ones that have a responsibility when it comes to health care reform, employers must also meet certain criteria.
What must employers do in order to fulfill their responsibility?
Automatic enrollment: Starting in 2014, “large employers” with more than 200 employees will have to begin automatically enrolling all new full-time employees (employees working more than 30 hours) in a health care plan. Automatic enrollment plans must provide adequate notice, as well as an opportunity for employees to opt out of any coverage. They must notify employees of ALL coverage options available to them, including plans offered through the exchange. They must also let employees know if they might be eligible for tax credits. Employers are required to make it clear to employees that if they shop the exchange for insurance, they may lose the employer contribution to their health plan. I think this applies to employers who offer an insurance plan other than one offered through an exchange. However, for employees that do shop the exchange regardless, this has the potential of saving companies thousands. Notice of coverage options is a necessary requirement for employers, especially concerning tax credits. Employers with employees that qualify for tax credits may face an “assessable payment.” So, employers may be hesitant to inform employees they qualify for such credits, or cost-sharing reductions. This is aimed at lowering premium costs. To qualify for tax credits, employees’ income must fall between 100 and 400 percent of the poverty line, and they can’t be eligible for any other “affordable” insurance. This means health insurance cannot cost an employee more than 8 percent of their total income in any given month. This provides an incentive for employers to lower health care costs for their employees — otherwise they must pay a fee. The fee essentially helps pay for part of the tax credits alloted for employees.
“Shared responsibility”: Any employer that fails to offer full-time empoyees the opportunity to enroll in minimal essential coverage for any month, and has at least one full-time employee certified as having enrolled in a qualified health plan by using a tax credit or cost-sharing reduction, will face an “assessable payment.” This payment will be equal to the product of the applicable payment amount and the number of individuals employed full-time during such month, up to $750 per full-time employee.
Waiting periods: Large employers (an employer with, on average, 50 full-time employees) are deterred from making employees wait an extended period of time to enroll in a health plan. This extended period is considered anything longer than 30 days. Employers that make employees wait to enroll will also face an assessable payment. This fee is equal to the product of the applicable payment amount and the number of full-time employees. The applicable payment amount is $400 for waiting periods between 30 and 60 days, and $600 for those longer than 60 days.
Reporting: The Secretary of Labor will conduct a study to determine whether assessable payments has lowered workers’ salaries. The Secretary will be ensuring companies aren’t taking full-time employees down to part-time, or reducing salaries by other means to make up for assessable payments. The result of the survey will be reported to the House of Representatives Committee on Ways and Means and the Senate Finance Committee. Large employers will also be required to complete a return that includes a certification of whether full-time employees were provided an opportunity to enroll in a health plan, the length of any waiting period, the months coverage was available, the applicable large employer’s share of total allowed costs of benefits and the number of full-time employees. Employers must also inform the employees they may have reported information about, and what information was reported.
Other interesting items included in this week’s reading of the bill include:
• Transparency in government: Within one month of the passage of the Patient Protection and Affordable Care Act, the Secretary of Health and Human Services was required to list all the authorities provided to the secretary under the act.
• Discrimination against individuals or health entities that don’t provide assisted suicide is prohibited. Any provider receiving federal funds from the Patient Protection and Affordable Care Act is prohibited from subjecting an individual or provider to discrimination on the basis that the entity does not provide assisted suicide, euthanasia or mercy killing. (So, I guess this means you can discriminate against those entities that do offer assisted suicide)
• The Secretary of Health and Human Services is barred from creating a regulation that: creates unreasonable barriers to the ability of individuals to obtain appropriate medical care; impedes timely access to health care; interferes with communications regarding a full range of treatment options between the patient and provider; restricts the ability of health care providers to provide full disclosure of all relevant information to patients making health care decisions; violates the principles of informed consent and the ethical standards of health care professionals, or; limits the availability of health care treatment for the full duration of a patient’s medical needs.
• Freedom not to participate: No individual, company, or non-profit entity or health insurance issuer is required to participate in any federal health insurance program created by the Patient Protection and Affordable Care Act. It also states there shall be no fee for choosing not participate in such programs. (So, I think this makes it clear there is no government-run health care)
• Discrimination: No one shall be denied coverage, or excluded from participation in an insurance program based on discrimination.
• Protections for employees: Employers are barred from discharging, or discriminating against employees because the employee has: received a tax credit; provided to the employer, government or attorney general information on a violation; has testified, or will testify about the violation; has objected or refused to participate in any activity, policy or practice that the employee feels is in violation of this act. This is just one more way the bill aims to protect employees.
Mary Ann Heath has been reading and blogging about the Patient Protection and Affordable Care Act since January. Her goal is to read all 906 pages of the bill in one year.
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