With January 2014 rapidly approaching and sweeping healthcare reform set to go into effect, employers, consumers, health plans, TPAs, and everybody in between has questions about ACA compliance and what it means to them.
To help find answers to some of your most pressing ACA compliance questions, the Healthcare Trends Institute has launched the Your ACA End-of-the-Year Policy Guide, a weekly blog series addressing some of the most pressing challenges facing today’s companies. For this week’s edition, we reached out to two of our Editorial Advisory Board members to get their unique take on how healthcare reform has and will affect their business.
Shajmil Smith is the Executive Director of Product Program Services and Solutions in the National Product Management department with Kaiser Permanente, one of the nation’s largest not-for-profit health plans with more than 9 million members. Craig Silverstein is a Product Manager with Paychex Inc., a leader in the payroll, human resources, insurance, and benefits outsourcing industry serving more than half a million businesses nationwide.
Below, they each share their unique take on the top 3 ACA challenges for 2014 and how they are responding.
Shajmil Smith, Kaiser Permanente
We saw this with the September announcement that the Employer Shared Responsibility mandate would be delayed until January 2015. At this time, there is so much information and speculation swirling about what the next big announcement in healthcare reform will be that it’s challenging to keep up. Every ruling impacts not only us, but our stakeholders, so we must be sure to always decipher information correctly and ensure we are complying with the most current mandates.
ACA Challenge #2: Providing our stakeholders (employers, broker/consultants, etc.) with the education and understanding they need to prepare for, and respond to, healthcare reform. Building on my previous answer, our members look to us to provide the latest news and updates on how healthcare reform will affect them. We play an important role in ensuring they’re ready to take action when they (and if they) need to. Because the healthcare reform landscape is both ever changing and deadline-driven, it can be a real challenge to deliver information and guidance to our members on a timely basis and in an efficient manner.
ACA Challenge #3: Understanding the new financial model created by the ACA and how it impacts a changing industry model.
Shajmil, Kaiser Permanente: Along with an understanding of ACA compliance comes a curiosity about how it will impact your company’s or even industry’s current financial model. This includes questioning how costs and payments will work in the future healthcare model being shaped by healthcare reform. If consumer-driven health care takes hold in the marketplace and we’re seeing that High Deductible Health Plans with HSAs continue to become more popular, for example, the health insurance cost-sharing structure we’re used to seeing between employers and employees may shift dramatically. Many of these answers will be unknown, though, until well after the broad market reforms outlined in the ACA take effect in January 2014.
Craig Silverstein, Paychex Inc.
ACA Challenge #1: Employer Shared Responsibility – helping our clients craft a health care solution for 2014 and beyond.
When it comes to Employer Shared Responsibility, it’s important for employers with 50 or more full-time equivalents to act now to avoid penalties later. In addition to our efforts to educate business owners on the requirements, we’ve developed new services to help our clients design and execute their benefit and workforce strategies to comply with this provision.
There are also other critical business decisions that employers of all sizes must take into account when designing their health benefits and workforce strategies – such as plan design changes, contribution strategies, and premium tax credits, to name a few – as they can have significant implications to benefit costs, compensation strategies, taxes for employers and employees, and employee retention. When employers have a clear picture of these implications, it becomes easier to see the best options. We now offer services that give our insurance clients a clear view of their options in order to make informed decisions based on their specific situation.
ACA Challenge #2: The Affordable Care Act has imposed requirements that are driving up the cost of small group coverage.
For smaller employers, particularly those not subject to Employer Shared Responsibility, it can be a struggle to afford group health insurance for their employees. Group insurance may not be an option for every employer, but there are alternate options available through consumer-directed health care – high-deductible health plans used in coordination with, HSAs, HRAs, and FSAs – that can help employers and their employees manage costs. If a group health plan is the right fit, employers can utilize HRAs and FSAs to cover out-of-pocket expenses such as co-pays associated with the group health plan. In addition, small employers who offer health insurance and meet certain criteria can take advantage of available small business tax credits.
ACA Challenge #3: Helping our clients prepare for, and respond to, a new set of employer reporting obligations created by the Affordable Care Act.
Paychex has a team of compliance and legal professionals that are constantly monitoring new and changing requirements of the health care reform law. One aspect that is receiving a lot of attention right now is the need for employers to provide employees, and the IRS, with information to help with subsidy qualification decisions. The IRS and U.S. Department of the Treasury are considering several methods of reporting to accomplish this, including making major modifications to Form W-2. Paychex is actively engaged in this conversation with the two agencies, and is positioned to support our payroll and health and benefits clients with their associated obligations, regardless of what the final outcome is.