On October 1st 2013, all employers will be required to send out the Department of Labor notification to all of your current employees informing them of their responsibility to find Health Care Coverage. The notice will also alert them to the availability of Exchanges (Cover California) to initiate the purchase of their Health Care Plan. This requirement is for every employer in California, and the nation for that matter. Everyone, whether you already provide a group plan or not, is required to get this information to their employees. This includes getting it to new hires within 14 days of the date of hire for employees hired after that date. The penalty for not providing this to your employees is $100.00 per day for each employee affected by not receiving this information. If you have 10 employees and do not comply, it is $1,000 per day.
A recent study shows that 75% of all employees in the state of California would like help from their employer in navigating a path to finding health care options for themselves and their families. Regardless if it is offered in your workplace, the new “exchanges” are going to be like a maze for employees who have never had to deal with healthcare or government bureaucracy in the past. Studies also show that most people are not prepared for the eventuality that they are going to have to go out and purchase an individual health insurance plan. Most employers and some HR Directors have trouble grasping options of these plans, so you know there will be issues for the individual.
Shortly Van Beurden Insurance will be rolling out an ACA “portal” or web page that will allow your employees to compare coverage options of the state exchange against what can be purchased in the private market. Even though the exchange will have some of these carriers in the plan, it is evident by the carriers own admission, that many of the doctors that are available in the group market will not be made available in the exchange or individual plans.
The cost in a head-to-head individual plan comparison, that we will give on the portal, will be identical (less any subsidy in the exchange), but the doctors networks in some of the plans will differ greatly. We see the portal as a benefit to your employees to accurately and fairly price out all options for healthcare, and allow them to make an informed decision. I would not allow someone who works in the exchange, with industry experience of under a year, lead me down a path to coverage because of the complexity of coverage itself.
Because of the large disparity in costs of individual plans, both now and after ACA implementation, pressure will be put on all employers to offer some kind of a health benefit plan. The Massachusetts example, with only 2% of all eligible participants choosing to insure under the state exchanges, is proof enough to lead us to believe the same thing will happen here in California. It was simply too costly for the individuals to purchase through the exchange. They in turn, went back to their employer to ask for any type of group health plan, regardless of whether the employer participated in cost sharing or not. This was caused as much by the inability of the state exchanges to correctly inform the individual, and by the ridiculous costs of individual plans under the system.
As you can see, by pushing back the 50+ mandate, the feds have not simplified the process for anyone. There are even more question that lie ahead for the 50+ firms that already offer and even more question and pitfalls for the 50+ employers that decide to wait. If you are at all unsure about your status as a large or small employer because of the use of temporary or seasonal labor, please contact me and I will sit down with you and run the matrix which designates what type of employer you are, and what your actual health care exposure is. In Agriculture, this becomes a bit blurry for many. One client I have was correct that they were a large employer, but severely overestimated his exposure (number of people that he needed to offer coverage. Do not let this be the case with your firm.
If you have any questions concerning your particular circumstance and the ACA, I recommend that you contact me at firstname.lastname@example.org , so that we can keep you compliant and out of the governments’ crosshairs.