Complex, uncertain -- Obamacare rollout has businesses scratching heads

2013-01-19T22:17:00Z 2013-12-17T11:41:41Z Complex, uncertain -- Obamacare rollout has businesses scratching headsMICHAEL BURKE mburke@journaltimes.com Journal Times

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

THE PROS

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.

THE CONS

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.

MORE INFORMATION

-- 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:

www.healthcare.gov.

Copyright 2015 Journal Times. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(14) Comments

  1. An American
    Report Abuse
    An American - January 21, 2013 8:12 pm
    As right as you are, don't tell this to Robin Vos who thinks the best employee is one that is owned and controlled. Come on, that what is fun about being a rich employer -- abusing and cheating your employees.
  2. ggodmuls
    Report Abuse
    ggodmuls - January 21, 2013 10:49 am
    Can it be recognized that in Racine, SCJ has an unfair business advantage over other businesses, because their property is tax-exempt?

    IT does make a difference to the bottom-line and the dollars available to spend on employee benefits.

    http://racinepost.blogspot.com/2009/06/sc-johnson-emails-offer-intimate-look.html
  3. Joeboy5471
    Report Abuse
    Joeboy5471 - January 20, 2013 6:53 pm
    A healthy employeeis a better employee. An employee who has benefits and an employer who cares about their employees gets the moneis spent back in spades. I hope the smaller companies realize this. SCJ provides probably the best employee bnefits in the state, if not the region. The company hass calculated the price of these benfits and has compared them to what they get back in loyalty, a well employee, an educated employee, a happy employee on the job and most evry attribute an employer wants and have come to the realization that for evey dollar they spend they get back the get back $1.45. If most employers would treat benefits the same way they do when they buy a machine or expand their operation they should come to a similar conclusion.
  4. Al Czervik
    Report Abuse
    Al Czervik - January 20, 2013 4:26 pm
    If all businesses are under the same national insurance system that portion of business becomes a non issue. I really believe that business owners will continue to invest in their companies. Desire for profit overcomes uncertainty.
  5. granny grits
    Report Abuse
    granny grits - January 20, 2013 3:05 pm
    Angry little man still can't support a ridiculous 20% claim?


  6. Blindman
    Report Abuse
    Blindman - January 20, 2013 3:01 pm
    Reform the health care system,yes...Also regulate over charging insurance co.'s that are nothing short of criminal price gougers...Also,why does the fed gov't need access to our bank accounts and medical records to reform healthcare???
  7. ggodmuls
    Report Abuse
    ggodmuls - January 20, 2013 12:16 pm
    HOO BOY! Talk about a flip-flop from the Gritty Granny! Usually we are treated to a diatribe against the salaries and compensation made by those in private enterprise.

    Why would an intelligent educated person oppose, much less demand anything less than a single payer, non-profit system?

    The door, under these mandates, are wide open for abuses, and all sorts of accounting shenanigans. BUT - we'll have it you way, since we all know that Liberal Granny Grits knows it all and is better than everyone else. We should all bow before Obama!

    Insurance Executive Compensation:

    For the third year running, the highest-paid executive among the three provider sectors was Stephen Hemsley, president and CEO of UnitedHealth Group, Minneapolis, who earned $42.2 million. Hemsley's pay totaled $13.4 million in annual compensation and $28.8 million in exercised stock options.

    David Cordani, president and CEO of Cigna Corp., had the highest annual compensation among insurers at $16.4 million, but he exercised fewer stock options than Hemsley for a realized pay of $18.4 million.

    Kent Thiry, chairman and CEO of kidney-care and dialysis company DaVita, Denver, took home the highest pay package among specialty-care providers and the second highest overall among all three provider groups. Thiry earned nearly $5.5 million in annual compensation—a decrease from his 2010 annual compensation of almost $9.4 million—but he exercised $24.5 million in stock options, which resulted in an overall pay gain of 91.6%. Thiry also topped the specialty-care list last year.


    I call that LOOTING a company and their customers for profit. Are you naive enough to think that will change under Obama? That they will be paid less? NO! No they won't, Granny. Insurance is OBSCENELY profitable!

    You are a lost, bitter, old, angry Liberal blinded by the Cult of Obama. He has sold you polished feces - and you can't see it for what it is.

    Pity for your lost soul.

    Obama: Robbing America! http://racine.craigslist.org/pol/3558544083.html



  8. Urban Pioneer
    Report Abuse
    Urban Pioneer - January 20, 2013 12:06 pm
    This decision making is going across the country with many different size companies. Look for a future where more employees will be reduced or held to 29 hours. Look for a future where companies will divide in to smaller entities to stay below the 50 employee cap. I know of a Company in the Racine area that had 200 employees. It has legally just broken into 4 separate companies and drop it's work force to 49 or less in each unit. This will allow the company to provide better health care to it's work force and avoid govt./ Obama-care dictates.
  9. granny grits
    Report Abuse
    granny grits - January 20, 2013 11:14 am
    Spectacularly stupid is the only way to describe your 'understanding' of the 80% directive. Are you so naive as to think people work for nothing, that there is no overhead for plant and equipment which comes out of that 20%?

    I'll type slowly so even you can follow along and understand: there is no guaranteed profit and certainly not 20% as you claim.

    Have you ever considered re-directing the time you waste with your embarrassing screeds and get an education? Maybe, then people won't roll their eyes and laugh at you.
  10. An American
    Report Abuse
    An American - January 20, 2013 10:05 am
    U.S. ranks just 42nd in life expectancy
    Lack of insurance, obesity, racial disparities to blame, experts say

    Associated Press
    WASHINGTON — Americans are living longer than ever, but not as long as people in 41 other countries.

    For decades, the United States has been slipping in international rankings of life expectancy, as other countries improve health care, nutrition and lifestyles.
    Countries that surpass the U.S. include Japan and most of Europe, as well as Jordan, Guam and the Cayman Islands
    .
    “Something’s wrong here when one of the richest countries in the world, the one that spends the most on health care, is not able to keep up with other countries,” said Dr. Christopher Murray, head of the Institute for Health Metrics and Evaluation at the University of Washington.

    This is why the United States needs to reform its health care system.
  11. ggodmuls
    Report Abuse
    ggodmuls - January 20, 2013 8:13 am
    Good Health = PRICELESS!

    Americans need to re-think their poor eating and exercise choices - as far too many have come to depend upon medical professionals to repair the damage they inflict by their poor choices. It is wrong to ask others to pay for them. Genetic testing needs to begin - and genetic defectives shouldn't be creating more, it is a burden to Society.

    Requires insurance companies to spend at least 80 percent of premium dollars on medical care and quality improvement activities. Provides for rebates for violations.

    Who says Obama isn't in the pockets of the insurance company executives? For profit Insurance = SCAM! End the fraud perpetrated by insurance companies and agents and end the insurance for profit scheme. Make it a single payer, not-for-profit, system. ObamaCare locks in 20% profits! What would you do with 20% returns? Obama knows the American people are asleep on this one! Think about it - a 20% guaranteed profit!

    Obama - Robbing Americans! http://racine.craigslist.org/pol/3558544083.html
  12. ride2fast4me
    Report Abuse
    ride2fast4me - January 20, 2013 2:34 am
    This thing is a disaster. When business people are uncertain, they don't invest, they don't hire people. When the choice is paying a small fine, or millions to cover an aging workforce, companies are going to dump healthcare left and right. Good luck to Washington figuring out what to do with sick people in Racine. Another epic fail by Obama...
  13. Zorro
    Report Abuse
    Zorro - January 20, 2013 12:34 am
    ... added benefit of saving $500 billion over the next 10 years in health-care costs.
  14. Zorro
    Report Abuse
    Zorro - January 20, 2013 12:20 am
    This is total bull. Bottom line is you get paid to do the right thing by insuring your employees and yourself. You get taxed if you choose not to. Pretty simple, really.
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