With a historic U.S Supreme Court ruling leaving President Obama’s Patient Protection and Affordable Care Act (ACA) essentially intact, affected employers that relied on a wait-and-see-if-it’s-junked approach before acting on the law’s provisions must now be sure they will be in compliance with its various requirements in time.
It should be noted that provisions of the new law exclude self-insured plans, according to the American Trucking Assns. (ATA).
However, there is much work to be done by employers that are healthcare plan sponsors. Such employers “who decided to take a ‘just in time” approach rather than a ‘just in case’ approach may find themselves at risk, with very aggressive compliance calendars for the remainder of the year and beyond,” pointed out a white paper published by Fidelity Investments ahead of the court’s decision.
According to Fidelity, these are the key implications for employers that are plan sponsors:
• Employers who have waited, for example, to address the issuance of SBCs [Summaries of Benefits & Coverage] will have less time to make sure those processes are in order. This may also be the case for claims and appeals processes.
• Employers should continue to take their normal steps to prepare Form W-2 health plan reports at year-end and finalize healthcare spending account limits. Other implementation tasks such as patient-centered outcomes, trust fund fee calculations, and “Cadillac tax” accounting should stayon track to reduce the risk of non-compliance.
• On the horizon for 2014 are the [creation of] health insurance exchanges and the obligation to inform employees of their services
Fidelity stressed that that obligation to inform employees as well as “other substantial reporting requirements facing employers are only just beginning to be addressed with guidance from the government,” suggesting that employers need to get their heads out of the sand about ACA and get moving on finding out how to comply with it.
Adding to the complexity for employers, as pointed out by ATA, no fewer than three agencies-- the Dept. of Health and Human Services, the Internal Revenue Service and the Treasury Dept. -- are charged with promulgating regulations to implement the new law. “The way in which the respective Executive Agencies chooses to interpret the new law will have a significant impact on the final requirements for carriers and their health care plans,” noted ATA in an ACA “question-and-answer” piece.
The Supreme Court’s ruling effectively leaves ACA intact— although the court did strike down provisions that would have allowed the federal government to put sanctions on states' existing Medicaid funding if the states declined to go along with the Medicaid expansion.
As pointed out in a report posted by The Wall Street Journal (WSJ ), the court’s decision “mostly preserves the biggest reworking to the health system since the creation of Medicare in the 1960s, after a legal battle of more than two years had left Mr. Obama facing the prospect of his effort being nullified. It also averts disruption for hospitals, doctors and employers who have spent more than two years preparing for the law.”
Most of the ACA mandates don't kick in until 2014-- which is when most Americans will be required to have health insurance or pay a penalty. That penalty will start at $95 a year or up to 1% of a person's income, whichever is greater.
“Tens of millions of Americans are expected to get insurance coverage under the system that starts in 2014,” pointed out the WSJ report. “But fewer people may end up getting covered because the court made changes to the law's Medicaid expansion… Another batch of people who earn more but still have low incomes will get tax credits to offset their insurance costs. Consumers will be able to comparison shop for policies in newly created exchanges that will operate like popular online travel websites.”
ACA stands. For now. Its future, though, will rest on which party ends up in the White House and gains controls Congress after the November elections. President Obama and most Democrats on Capitol Hill are intent on seeing ACA put into action. And Congressional Republicans as well as GOP presidential nominee Gov. Mitt Romney are just as determined to see it overturned. Yet, as reported by WSJ, while the GOP has said it has an “alternative proposal,” the party hasn’t been specific about what it would include.
