State Reps. Ed Clere of New Albany and Ed DeLaney of Indianapolis came to the 2013 ISBA Annual Meeting to explain to lawyers “Health Care Options for Small Law Firms & Your Clients.”
They didn’t make the drive to French Lick to state the obvious as part of their presentation, but indeed they did. “This is one of the most complex pieces of legislation,” Delaney said as he walked those who attended the Oct. 17 plenary session through the health care labyrinth that is the Patient Protection & Affordable Care Act, commonly known as Obamacare.
“There’s a lot of math,” Clere said, “a lot of decisions about health care needs.”
There are also several important dates to remember, the first of which had already passed – Oct. 1. That date was the first day for open enrollment in the Health Insurance Marketplace. It was also the date employers were required to notify their employees of the marketplace, created to help individuals, families and small businesses find health coverage. “If you haven’t done that,” Clere said, “I recommend you go right back home and do it.”
Clere, a Republican, is chair of the Indiana House of Representatives’ Public Health Committee. DeLaney is the ranking Democrat on the Insurance Committee.
In their nonpartisan presentation, the two men pointed out some of the nuanced decisions small firms would have to make to get maximum benefit out of the new health care system.
For example, DeLaney pointed out that in Indiana individuals whose income is between 100 percent and 400 percent of the federal poverty level may be able to receive tax credits and/or subsidies (on a sliding scale) to help pay their insurance premiums. So, taking an employee who is just under the federal poverty level up a notch would help them considerably more because they could get the maximum subsidy. At the same time, a pay raise may hurt employees whose earnings are at 400 percent of the poverty level because it would cost them their subsidy.
While those who work alone would use the Health Insurance Marketplace, small firms (those with 50 or fewer full-time equivalent employees) should seek the Small Business Health Options Program (SHOP), a program scheduled to begin Nov. 1 and designed to simplify the process of buying health insurance.
Small businesses may want to use SHOP, DeLaney said, to help their staff get high-quality coverage with all essential benefits. He said employers would have substantial control over coverage and costs, including the coverage offered and how much the business will pay toward employee premiums. Some small businesses may also qualify for a tax credit worth up to 50 percent of premium costs.
“It’s a dynamic decision,” DeLaney said, “one many firms and clients are going to need help with.” Employees have decisions, too, he noted. If their employer picks a plan that is “too skinny,” those people have the right to opt out, going instead to a health exchange. The number of employees taking that option, of course, will affect the rates of those who stay in the employer plan. DeLaney said such elements of the Affordable Care Act “are the beginning of breaking the connection between employer and health insurance.”
The next important date on the Affordable Care Act is Jan. 1, 2014, the first day coverage could begin. The next big date is March 31, 2014, the end of the open enrollment period. After that date, Clere noted, people won’t be able to sign up until the next enrollment period, which will most certainly only last for a couple of months. There are exceptions, however, for significant life changes, including divorce or job loss. Still, there are penalties involved. “The Affordable Care Act doesn’t allow you to wait to get sick,” Clere said.
While the presentation was nonpartisan, DeLaney did take the opportunity to point out that Hoosiers whose incomes are between 27 percent and 100 percent of the federal poverty level are not eligible for Obamacare because Indiana elected not to expand Medicaid. That’s about 300,000 people. “We could have done better,” said DeLaney, who noted that the Indiana General Assembly will face some choices in the 2014 session.
In addition to expanding coverage for those 300,000 people, he said Indiana has the option to open a state-controlled exchange with an eye to providing more options and providers. Other options include a program to encourage plan sponsors to continue providing health insurance to pre-Medicare retirees and action to “define essential benefits differently than the federal government.”
To begin the search for information, go to Healthcare.gov. For specific information on how small firms should proceed, go to Healthcare.gov/small-businesses. Useful information can also be obtained from the Henry J. Kaiser Family Foundation at kff.org.