It’s a challenging time for everyone in America’s quickly morphing healthcare landscape. Families who have been squeezed for years between paying higher shares of premium costs and higher deductibles now wonder whether they will be able to pay for insurance at all, or if next year, with inflation driving many necessities ever higher, they’ll just have to go uninsured in the coming years and take their chances. With high deductible plans becoming the norm, many families with insurance don’t feel covered even if technically they are – because they have no hope of paying the deductible in the event of a medical emergency. In a recent survey done by the Federal Reserve, only 48 percent of respondents said they could easily pay for an unexpected expense of $400. Almost 20 percent indicated they could not pay it, even on credit or with help from friends or family. Most high deductible health insurance plans do not pay at 100 percent after the deductible is met either, which means a high percentage of Americans are one medical emergency away from financial peril.
Business owners are no less conflicted, often going uninsured themselves because of revenue constraints even as the U.S. government compels them to offer their employees coverage. While some companies have refused to work within the boundaries of the Affordable Care Act and have pushed their formerly covered employees onto state or federal exchanges, most business owners are invested in their workers and would prefer to help them cover their health care expenses in a way that doesn’t bankrupt their companies. With the botched rollout and the long list of mandate changes or delays, the current situation is even harder to understand, however. Here is some information they need to know:
- The employer mandate has for businesses with 50-99 workers has been pushed back until 2016, so there will be no fines for not offering coverage until then. Businesses of this size have additional time to figure out their options.
- While the employer mandate for businesses with 100 or more workers will be in force in 2015, businesses only have to offer qualifying plans to full-time employees, defined by the government as working an average of 30 hours a week or more.
- Mandated businesses only have to offer their employees qualifying plans in order to avoid the fine. They can offer additional plans as well, give them cash raises in lieu of benefits, offer to pay certain benefits in cash, or incentivize their employees to sign up for less expensive plans.
- The legality of the Affordable Care Act exchange subsidies has been subject to a number of lawsuits and, given two recent conflicting rulings at the federal level, will likely be decided at some future date by the Supreme Court. Meaning: companies that believe their workers will be better off financially with plans from state or federal exchanges should not make assumptions.
- Further, plans purchased on the exchanges with subsidies appear to be vulnerable to significant cost increases, many of which will not be apparent until the purchaser gets does his taxes in 2015 or 2016.
- Employer driven cost-containment strategies appear to be slowing the rate of cost increase. So there are things businesses can combat what has seemed to be inevitable health insurance cost inflation. Most of these are focused on educating people on the real costs of healthcare by making them bear some of these costs themselves.
Business owners and Americans live in interesting times. While the landscape of costs is shifting constantly, getting up-to-date information on the current legal requirements of the Affordable Care Act will help companies make the best decisions they can for their workers and their bottom lines. Over time, continuing to be uninformed will be costly.