With so much being said and written about healthcare reform, many employers don't know where to begin to find practical information about how the law will affect the workplace and what they should be doing to prepare, even now.
More importantly, employees are being bombarded with information they don't understand, or even downright misinformation, and are looking to their employers to help them wade through this complicated maze of new legislation. This article will hopefully clear up some of the confusion and provide a practical roadmap to what is already in effect and what is coming down the road.
3 Issues to Address Now
Although much of the healthcare law takes effect years down the road, there are a number of provisions which are of immediate impact to employers. Three examples are addressed below: new whistleblowing protections, the right to privacy for workplace nursing, and deciding whether to "grandfather" your health plan.
First, all employers should understand that the healthcare reform law dramatically expands whistleblower protections in the workplace. For example, an employee who makes a complaint about a perceived violation of the new healthcare law is protected from retaliation.
Similarly, if an employee opts out of an employer's plan and chooses to be covered in one of the new healthcare exchanges scheduled to start in 2014, that act is protected from retaliation.
Second, in addition to the creation of whistleblower protections under the FLSA, the new law requires the right to privacy for workplace nursing. Employers must provide:
unpaid, reasonable break time to non-exempt nursing mothers to express breast milk;
a place to express breast milk that is not a bathroom, is shielded from view, and free from intrusion
An employer with fewer than 50 employees will not be required to implement this provision if doing so would cause the employer an "undue hardship." However, an employer with more than 50 employees will be required to follow the law, even if its employees are working on a client's premises or at a location where it is difficult to provide privacy. The nursing mother protections created by the law are available for one year after the child's birth.
Lastly, this year poses a one-time opportunity to grandfather a health plan from many of the changes required under the new healthcare law. Healthcare plans that were in existence as of March 23, 2010 (the day the law was enacted) can be exempted from a multitude of requirements imposed by healthcare reform so long as the plan does not substantially change the benefits offered, change insurers, or increase employee costs by a significant percentage (as defined in the regulations).
Employers should talk to their insurance brokers or carriers to determine whether grandfathering makes sense. The benefit to grandfathering is an employer can avoid mandated changes such as first dollar coverage of preventive care, and new recordkeeping requirements.
The downside is that grandfathering means severe limits to passing on rate increases to employees, and an inability to shop carriers for a better rate. With the seemingly annual rise in costs, these limits will make grandfathering a bad deal for many employers.
Issues coming over the next four years
The heathcare reform law has far reaching effects and drastic changes to the heathcare system. Necessarily, these changes are spread out over an extensive period of time, with a gradual rollout. A timeline of important dates to keep in mind for strategic purposes is listed below.
2011
Beginning in 2011, employees will have a right to request a W-2 form anytime during the year, once they have been terminated. Although it is not likely that most employees will get an early start on their taxes, employers should be aware of this new possibility.
More importantly, for the 2011 tax year, employers will be required to start reporting on the W-2 form the value of the health insurance premiums paid for each employee. This would include both the employee and employer's share of the premium.
Out of all the changes in the healthcare law, this one might be one of the most beneficial, as employees will finally get to see what their healthcare really costs (not just their share). Contrary to rumors that have been circulating recently, these amounts will not be taxable.
Also in 2011, flexible spending amounts (FSAs) will be changed to only allow reimbursement for prescription drugs and not over the counter medication.
2013
Starting in 2013, there will be additional Medicare taxes on individuals making more than $200,000 per year and couples making more than $250,000 annually. These Medicare taxes will not be paid by the employer, but instead, only the employee. In 2013, the law also implements changes to FSAs limiting the maximum amount available for such accounts to $2,500.
2014
In 2014, the most significant changes to the healthcare law will take effect. Every individual will be mandated to have health insurance and employers with more than 50 employees who do not offer heath insurance will be penalized.
Each state will implement healthcare exchanges where individuals can buy health insurance as part of a larger group for cost savings. Employees earning less than 400% of the federal poverty level will receive federal subsidies to purchase health insurance.
2018
The last step to be implemented is the 40% tax on expensive heath care plans, dubbed "Cadillac plans." These high cost health plans are defined as having a value of $10,200 for a single employee or $27,500 for a family. The law contains certain exclusions for high risk jobs and other special occupations.
Healthcare reform will have a far-reaching effect on companies in the United States. Armed with the information necessary to make educated decisions, however, companies will be able to implement the requirements of reform in a timely, and efficient manner and make good strategic decisions on how their business goals fit within the new law.
Two years ago, doctors at the University of Minnesota took an enormous risk by putting a little boy with a terrible skin disease through a bone marrow transplant. For that boy, Nate Liao, it worked out, and he is healthier now. Thursday, in a study published in the New England Journal of Medicine, the researchers are for the first time making public their results treating seven other children with the same genetic disease. In it, they acknowledge just how risky the procedure is: Two of the seven, including the older brother of the first patient, died as a result of the treatment. But in the others it worked -- a leap forward for a devastating and painful genetic disease for which there is no other treatment and a potentially significant advance for the use of adult stem cells.
The Florida Medical Association, undergoing an apparent identity crisis, is gathering in Orlando for a debate on whether to break off from the American Medical Association. Unlike past years, the sessions will be closed to the press. A resolution by Fort Myers plastic surgeon Douglas Stevens calls for the break because of the AMA’s support of the new federal health law. It will be considered by the House of Delegates at the annual meeting, which begins Friday. His resolution says the law amounts to “a severe intrusion in the patient-physician relationship and allows government control over essentially all aspects of medical care.” Another of the nine “whereas” clauses complains that the law erodes doctors’ independence and will “relegate physicians to the role of government employees …and essentially end the profession of medicine as we know it.”
Anna Burger, a top labor leader at the SEIU and Change to Win, will leave that position, according to an official. Burger will retire from her positions as secretary-treasurer at the Service Employees International Union and chairwoman of the Change to Win coalition, marking an era of major transition for the powerful union. Her departure comes after she lost the election to replace Andy Stern as the top leader of the SEIU earlier this year, leaving Mary Kay Henry as the union's new president. SEIU has been one of the biggest boosters of President Obama's agenda, helping push through a number of legislative priorities and spending big on behalf of Democratic candidates.
Nevada State Sen. Shirley Breeden understands the patient suffering caused by hospital-acquired infections. While she was in Carson City last year championing a bill to require stricter reporting of such cases, her father was battling a Methicillin-resistant Staphylococcus aureus, or MRSA, infection he contracted in a Las Vegas hospital. The bill passed, but Breeden is disappointed it won’t lead to the transparency needed to make hospitals’ reports meaningful for the public. When Breeden, a Henderson Democrat, met with lobbyists in March 2009 to discuss Senate Bill 319, they told her they would block any legislation that allowed infections to be identified by individual facilities, she said. To get lobbyists for physicians and hospitals to support reporting by hospitals, she had to promise the information would not be made public. Friday, the State Board of Health is slated to adopt those regulations for the new law.
University of Texas medical leaders said Wednesday that federal health care reform legislation will present formidable challenges as increasing numbers of Medicaid patients and decreasing rates of reimbursement strain their schools' ability to teach new doctors and nurses and conduct research. The leaders of the six UT health institutions told the system board of regents that they will need to think creatively to respond to the newly covered population, projected to be as many as an additional 2 million people in Texas. UT institutions will shoulder the largest burden. "The good news is that more of the uninsured are going to have access," said Dr. John Mendelsohn, president of UT's M.D. Anderson Cancer Center. "The bad news is that under the current payment system, none of us are going to have our costs covered."