President Barack Obama has won re-election now the nation is awaiting how the Patient Protection and Affordable Care Act will help overhaul the health care industry and expand coverage to millions to uninsured American.
Tom Doney, president of Cypress Benefit Administrators, a Grand Chute-based company, which helps businesses nationally set up health plans, offered his insight on the possible path of the act for business and people moving forward:
What do you expect will happen now that President Obama won re-election?
As it regards health reform, it will basically be status quo for now. The fact that Obama retained the White House and the Democrats kept control over the Senate means that any desire the Republicans had to change the law has been rendered moot.
That said, we're starting to see certain parts of the law being recognized as almost impossible to practically enact in the time that the law calls for, so there will likely be delays and concessions made. Most of PPACA is supposed to be up and running by January 2014. That is looking more and more improbable.
Might some of the complex parts like state exchanges and Medicaid expansion be delayed or watered-down because of the tight time?
Not only would it be an embarrassment, but everyone in big or small ways has been gearing up for Jan. 1, 2014. However, it may end up as the only option. It's a difficult process and an unpredictable turn may happen at any time.
A sign of the slowing progress is that states have been given until Dec. 14 to report to the Department of Health and Human Services if they plan to sponsor a state exchange or not. States say they are still waiting for needed federal guidance to sagely make the decision, and most are leery of jumping into what could be a new budget-busting program that could plague states into the future. Similarly, a delay until Feb. 15 has been given for states to say if they plan to have a federal-state partnership exchange.
Almost every PPACA regulation would have made some groups angry or provide attack-ad ammunition against the Obama reelection, so there was purposely a log-jam leading up to the election. Now the dam is broken, and regulations are being sent to the White House Office of Management & Budget at record pace for clearance to be issued.
The range of regulations you will see being announced in the media shows how broad PPACA is. It's a huge, nasty animal that will be hard to control over the coming 12 months.
What should businesses prepare for?
There are so many things that businesses need to prepare for, they had better find someone, like a TPA or consultant who understands the regulations, and who can help them to ensure compliance. The requirement to publish summary of benefits documents in the prescribed format, required plan changes to eliminate lifetime and annual limits, changing dependent coverage to age 26, adding preventive services without copays or limits, changes to emergency room visit limitations, elimination of pre-existing conditions clauses, additional reporting requirements and so many more requirements under the law will put a lot of pressure on the employer.
Employers will probably have to prepare for additional costs associated with offering health benefits to employees. To say nothing of the coming confusion and misinformation that will be out there.
What remains unanswered for businesses?
What remains unanswered revolves around how this law is going to be regulated and how much the government will pay attention. At this point, it's such a huge undertaking that I think at least for the short term, the Feds will just want to see that an employer is making their best effort to comply and that corrective action is being taken when they are found to be out of compliance.
Additionally, as the regulation writers, who are expected to issue interpretations of the law, dig deeper into how it should be regulated, there may be changes that nobody has even thought about today. It's a crap shoot, I think. And given the "fiscal cliff" that looms on the horizon with the government, nobody can predict with any accuracy whether or not some parts of the law will be "unfunded" by the congress, essentially rendering those parts useless. So only time will tell.
Are costs for businesses to provide insurance to employees going to increase?
In a word, probably. Adding benefits and having previously uncovered employees forced to join the plan can do nothing but raise costs. That's why it's imperative for employers to look to the expertise that exists in the market from those that deal with these things every day.
Many employers will be looking to self funding their plan in order to avoid some of the regulations in the law and to take control over their destiny as opposed to relying on a fully insured plan over which they have no control. So there are options out there and ways for employers to deal with these changes, but they have to be willing to investigate, find the right options for them and enact those changes.
This is where Cypress can help. Our clients nationally experienced costs that are 31 percent below national averages for health insurance and have limited their year-over-year cost increases to 3 percent annually over the last five years.
Our clients have been willing to make changes to their plans, enact appropriate cost control measures and find ways to engage their employees, but it only gets done if the employer becomes willing to consider the necessary changes to their benefit offerings. I think you'll see more and more employers looking to make those changes.
What's in store for the public?
Probably the biggest thing is that if they don't have coverage today they'll be required to do so, or pay the penalty for eschewing coverage. Most of the uninsured in the country are so because they have chosen to do so, not because they just can't get coverage, despite what you've been told by the supporters of PPACA. Many may choose to pay the penalties rather than take on the expense of required coverage (ironically, the penalties are far less costly than buying coverage for many).
Some employers have already talked about reducing hours worked for employees to below the 30-hour "full time" definition so they won't be required to offer health benefits. I believe the CEO of the Papa John's Pizza chain recently came out and said that's his plan, so people may see lower income rates as a result.
Another big question is whether or not the public will have access to coverage via a state health exchange and whether or not those exchanges will be cost competitive for them. Wisconsin, for example, has decided not to sponsor an exchange.
Distributed by MCT Information Services
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SEPTEMBER 2, 2014
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