The Affordable Care Act (ACA) in California, Covered California, is upon us with a "go live" date of Oct. 1, and an effective date for coverage of Jan. 1, 2014. Even though the employer mandate was pushed back for one year (Jan. 1, 2015), employers must make a long-term decision now about their workforce. This is a major challenge considering the ACA's 2,500 pages of cumbersome and contested legislation and confusion over the implementation process for businesses and individuals.
I anticipate that many of my peers in healthcare would agree, though perhaps not publicly, that the most positive thing one can say about ACA, commonly known as "Obamacare", at this time is that the process has begun.
The overall conversation about the ACA, though, is filled with trepidation and even dread. Sen. Max Baucus (D-MT), one of the key architects of the law, recently referred to ACA as follows: "I see a huge train wreck coming down." While this statement was in reference to the questioning of U.S. Health and Human Services Secretary Kathleen Sebelius on her proposal to raise money from corporations for the promotion of Obamacare, it nevertheless represents the view of many.
While I recognize the popularity of the ACA's provisions, especially those that were implemented early on, such as the ban on disqualification for pre-existing conditions and the opportunity for dependents under age 26 to continue on their parents' plans, the devil is in the details. And with ACA, there are lots of details.
Recently, the fast food giant White Castle announced that it will be focusing on hiring only part-time employees for the foreseeable future. Many other employers, especially in the temporary hiring and food service industries, are following suit. The reason for this is simple. It is a method to avoid the penalty known as the employer mandate, which kicks in for employees hired at 30 hours per week or 120 hours per month.
This penalty is heaviest at the low-hourly-rate levels, at or just above minimum wage. It is estimated that the cost of the employer mandate is approximately $1.30 per hour. For a skilled worker, perhaps, that amount can be absorbed, but at minimum wage, no such opportunity exists.
In addition, employers will soon become increasingly aware of misinformation about the financial benefits of the exchange, sold as the method of allowing everyone to participate in savings generated by having a large pool of insured individuals. In a recent article in Forbes Magazine, "Rate Shock in California," Peter Lee, executive director of Covered California was quoted as saying that, "rates ranged from 2 percent above to 29 percent below the 2013 average premium for small employer plans."
The truth is that under Obamacare, only people under the age of 30 can participate in the slightly cheaper catastrophic plan. So, if you live in this state and you're 40 years old, your cheapest option is the Bronze Plan under Covered California at $261 a month vs. $121 a month on eHealthInsurance, or an increase of 116 percent.
As the ACA becomes a reality, its impact on employers and individuals will be significant, including increased insurance premiums, loss of coverage by a large number of Americans, deleterious effects on healthcare providers, including hospitals, and financial challenges for employers.
Anderson will be the featured speaker at a Chamber-presented symposium that will be held from 7:30-9:30 a.m. on Wednesday, Sept. 4 at Tri-City Wellness Center, 6250 El Camino Real.
I anticipate that many of my peers in healthcare would agree, though perhaps not publicly, that the most positive thing one can say about ACA, commonly known as "Obamacare", at this time is that the process has begun.
The overall conversation about the ACA, though, is filled with trepidation and even dread. Sen. Max Baucus (D-MT), one of the key architects of the law, recently referred to ACA as follows: "I see a huge train wreck coming down." While this statement was in reference to the questioning of U.S. Health and Human Services Secretary Kathleen Sebelius on her proposal to raise money from corporations for the promotion of Obamacare, it nevertheless represents the view of many.
While I recognize the popularity of the ACA's provisions, especially those that were implemented early on, such as the ban on disqualification for pre-existing conditions and the opportunity for dependents under age 26 to continue on their parents' plans, the devil is in the details. And with ACA, there are lots of details.
Recently, the fast food giant White Castle announced that it will be focusing on hiring only part-time employees for the foreseeable future. Many other employers, especially in the temporary hiring and food service industries, are following suit. The reason for this is simple. It is a method to avoid the penalty known as the employer mandate, which kicks in for employees hired at 30 hours per week or 120 hours per month.
This penalty is heaviest at the low-hourly-rate levels, at or just above minimum wage. It is estimated that the cost of the employer mandate is approximately $1.30 per hour. For a skilled worker, perhaps, that amount can be absorbed, but at minimum wage, no such opportunity exists.
In addition, employers will soon become increasingly aware of misinformation about the financial benefits of the exchange, sold as the method of allowing everyone to participate in savings generated by having a large pool of insured individuals. In a recent article in Forbes Magazine, "Rate Shock in California," Peter Lee, executive director of Covered California was quoted as saying that, "rates ranged from 2 percent above to 29 percent below the 2013 average premium for small employer plans."
The truth is that under Obamacare, only people under the age of 30 can participate in the slightly cheaper catastrophic plan. So, if you live in this state and you're 40 years old, your cheapest option is the Bronze Plan under Covered California at $261 a month vs. $121 a month on eHealthInsurance, or an increase of 116 percent.
As the ACA becomes a reality, its impact on employers and individuals will be significant, including increased insurance premiums, loss of coverage by a large number of Americans, deleterious effects on healthcare providers, including hospitals, and financial challenges for employers.
Anderson will be the featured speaker at a Chamber-presented symposium that will be held from 7:30-9:30 a.m. on Wednesday, Sept. 4 at Tri-City Wellness Center, 6250 El Camino Real.