RACINE COUNTY — Complexity and uncertainty might be good words to convey local companies’ perceptions of national health care as it descends for a full landing in 2014.
The Affordable Care Act, or ACA — often called Obamacare — is being phased in but reaches full implementation next Jan. 1. Some regulations that will determine its final form and effects on employers are still being settled.
“I would summarize (the implications) as an unknown,” said Tom Marini, president of Marini Manufacturing, 5100 21st St., an employer of about 35 people. “We just get bits and pieces.”
Marini said his executives have been “proactive,” attending seminars and bringing in lawyers said to be experts about the ACA.
“I’m always concerned when the lawyers don’t understand it,” he remarked.
So far, Marini said, “There’s nothing that jumps out as terrible.” However, “We just feel that everything’s still been a generality, and not much detail.”
Poclain Hydraulics, an employer of about 215 people, is on the side of feeling mostly well-informed, said Human Resources Manager Johanna Gross. The law’s phase-in has helped, but there’s much about what will happen in 2014 that remains to be learned, she said.
“I guess we’re of the opinion that’s: Don’t worry about it until it’s actually going to happen,” Gross said.
And her own opinion, as an administrator at Poclain, 1300 N. Grandview Parkway, is the law contains some good provisions. For example, Gross said, “I don’t think companies or insurance companies should make choices about who you should have to cover. As an employee, I don’t want to be a part of it.”
The biggest unknown, Gross said, is how well the insurance-buying exchanges will work, and she thinks there’s very little information available yet about that.
‘Full time’ changing
The law’s uncertainty climbs for employers of large numbers of part-timers, such as Dottie Metz and Dave Jones, who have six Racine-area McDonald’s franchises.
Because of corporate support and instruction, Jones said, “We have a pretty good handle on (the law).”
However, next Jan. 1 the federal definition of a full-time employee drops from 38 to 30 hours a week, he said. The calculation will be based on this year’s employment pattern.
Metz and Jones now employ about 335 people, about 60 of them classified full-time, he said. If the “full-time” definition changed today to 30 hours a week, that part of their workforce would triple to 180 to 200 people, Jones said.
Meanwhile, he and Metz are waiting for the U.S. Department of Health and Human Services to finish writing the law’s regulations. Those are expected by early April, Jones said.
“Then we can sit down and make some decisions about what we’re going to do. ... We would have to look at the cost and weigh our options.”
Jones said, “It’s not our intention to not offer insurance, at this point.”
Currently, Metz and Jones offer their full-time managers and maintenance staff health insurance at half-cost, Jones said.
But the ACA complicates things for them by limiting the amount a household can pay to 9.5 percent of its adjusted gross income, Jones said. “But I don’t know what (employees’) household income is, because they don’t tell me.”
Jones remarked: “Twenty years from now, we’ll all be going, ‘That was hard, but we survived. We got through it.’ ”
O&H Bakery owner Eric Olesen has a similar situation, with about 150 employees, about 70 of them full time and the rest part time.
He’s still trying to fully understand the law, its implications and costs.
“I get the impression it’s kind of an unknown what the final result will be,” Olesen said.
“In business it’s difficult when you don’t have the goalposts to know where you’re trying to get to.”
AFFORDABLE CARE ACT
Benefits of the Affordable Care Act, according to healthcare.gov, the federal website dedicated to explaining the law:
-- Designed to curb the rising cost of health insurance for individuals and small businesses.
-- Makes insurance company discrimination for pre-existing conditions illegal.
-- Requires insurance companies to spend at least 80 percent of premium dollars on medical care and quality improvement activities. Provides for rebates for violations.
-- Requires insurance companies to publicly justify raising rates by 10 percent or more.
-- Establishes new, competitive marketplaces in each state called affordable insurance exchanges for individuals and small companies to use in comparison shopping for private insurance.
-- Creates tax credits small businesses may be eligible for if they shop through the exchanges. Credits begin at as large as 35 percent and grow to as large as 50 percent in 2014. Companies may qualify if they: 1. Have low-wage workers. 2. Pay at least 50 percent of the premium cost and 3. Have up to 25 full-time equivalent employees.
-- Companies will also still be able to self-insure.
Some projections and criticisms of the Affordable Care Act according to the Cato Institute, a public policy research organization dedicated to the principles of individual liberty, limited government, free markets and peace:
-- Cost will begin at about $20 billion in 2013, with a projected increase to $2.48 trillion in 2017 and about $4.2 trillion in 2022.
-- Creates 19 new taxes.
-- Will pay $2.48 trillion cost in 2017 with $1 trillion in new taxes and $1.48 trillion in debt.
-- 13,000 pages of regulations.
-- Physicians may stop accepting Medicare patients.
-- Some hospitals and nursing homes that provide Medicare services could become unprofitable over a decade.
-- Average premium will double in next six to 10 years.
-- General Information: www.healthcare.gov/small-business.
-- The tax credit: www.irs.gov/sbhtc.
-- Finding coverage now: finder.healthcare.gov lets you find insurance options for your company by exploring your coverage and pricing options.
-- Prevention and wellness provisions of the law that may affect you and your family: