More than a month after lawmakers passed a major overhaul of the American health care system, businesses, their employees and even government officials are still sifting through all of the details of what that legislation means.
At an event Monday in Washington a panel of experts tried to answer some of the questions left in the wake of historic legislation that has employers looking for answers on how to implement the changes lawmakers mandated, employees wondering how to take advantage of the new system and officials at the Department of Health & Human Service figuring out how to fill in the holes that Congress left behind.
“The biggest of all questions employers are getting is on adding dependants,” Paul Dennert, senior vice president of the American Benefits Council says about the new law’s provision allowing parents to add children up to 26 years old on their family insurance policies.
What’s not clear from the law is how the costs associated with adding extra family members to plans will be spread out. There are tax questions for the employer and employee alike that need to be sorted out. Dennert says officials at HHS are in the process of offering some guidelines to sort out all of the details. Those guidelines could come out as early as Friday, Dennert said at the event hosted by the U.S. Chamber of Commerce.
Even if HHS is able to answer some of these lingering questions this week, uncertainty over the new law is expected to continue for quite some time. In the short run, this puts employers who are now in the process of making decisions about their health care coverage for next year and beyond in a precarious situation of possibly running afoul of federal rules that have yet to come down.
Dennert calls this a “real world decision for many employers” that can’t wait on HHS officials to tell them what to do. He hopes employers who make good faith efforts in their health care policies will be protected if their decisions ultimately run afoul of federal law.
Other questions left unresolved include the amount of any yearly cap on benefits and what changes plans grandfathered from the new law will have to make to maintain exempt status.
So much of the underlying uncertainty comes from the massive size of the bill and the piecemeal fashion by which many of the changes will take place. Most of the significant adjustments, especially the exchanges that will add millions more to the insurance rolls, will not take place until 2014 or later, which makes the next few years a period of significant transition.
Another concern was raised over the viability of a small business tax credit offered to help offset some of the costs associated with coverage. “We’re unsure how many people are going to be able to access this credit,” said Amanda Austin of the National Federation of Independent Businesses. Employers are eligible to apply for the credit now but Austin is critical of lawmakers for what she views is a narrow set of requirements that few small business owners will be able to meet to qualify for the full credit.
Austin also bemoaned a new mandatory tax reporting requirement she says is sure to increase costs for business owners.
Monday’s event included the release of a study sponsored by the Chamber analyzing the impact of the new law which its backers said would insure more Americans while containing costs. The report cited a small Philadelphia trash company that has 55 full-time employees and spends $600,000/year on health care costs. In 2014, if the company decided to drop its health plan, it would pay $50,000 in fines. In other words, the study shows, the company will save $550,000 by not offering its workers health insurance and forcing them to find insurance on their own.
All of the day’s panelists said changes to the current law are likely. One even suggested part of the legislation might be repealed. Bruce Josten of the Chamber put it rather simply when he said, “health care reform is not over.”