Ad-Express and Daily Iowegian, Centerville, IA

December 27, 2013

ACA costing Centerville employees more for health care

By Michael Schaffer Managing Editor
The Daily Iowegian

---- — The Affordable Care Act might mean one thing to one group of people and something else to another group of people but to Centerville employees to means more money.

The ACA contains a provision called the Transitional Reinsurance Program Assessment fee where all self-funded plans like the one Centerville has for its 39 employees requires each member to pay $63 more in year 2014 in the form of a fee or surcharge.

According to Wikipedia, self-funded health care is self-insurance where employers provide “health or disability benefits to employees with its own funds.”

Patrick Antonen, city administrator, last week said the $63 is “essentially a surcharge to help stabilize premiums in the individual market. The fee is the reinsurance program for higher-cost claimants and non-grandfathered individual market plans both on and off the exchange,” he said.

Not only will each employee have to pay the $63 per year but each family member they have included in the plan will be charged the same amount.

For a family of four, that means the ACA is costing them $252 in 2014.

Antonen said he was bracing for a double-digit health care rate increase because of the ACA. He said he was shocked when that didn’t happen.

He said the $63 surcharge or fee is a small price to pay for health care. He said he had heard the surcharge would only apply for the year 2014.

“And just hopefully it’s just for this calendar year, for 2014,” Antonen said. “Hopefully by 2015 they let the self-funded programs out.”

According to Internal Revenue Service documents, the transitional reinsurance program “to help stabilize premiums for coverage in the individual market” will be in effect during the years 2014 through 2016.

Antonen called ACA “very complicated” with a lot of unknowns.

“It’s kind of an unknown,” Antonen said. “Like everyone else with this whole thing it’s so new to everyone that everyone is kind of waiting and seeing what is going to happen with it.”

So, for those employed by entities that are self-funded like municipalities, counties and businesses, the ACA is costing them more money. Wikipedia estimates 59 percent of companies in the U.S. self-fund part of their health insurance.

For others, the ACA is the loss of health care insurance altogether because mandates forced insurance companies to drop plans. And for others, they have qualified for expanded Medicaid and health care insurance through the “Marketplace” or exchanges.

Something to pay attention to is how will the federal government look at volunteers who put in time for local fire and police departments and emergency responders.

The question not yet answered is, will the ACA force municipalities to provide health care to city volunteers?

According to factcheck.org, the short answer is “Not likely.” However, they go on to state the IRS “has not addressed the issue, though it may shortly when it issues final employer rules.”

Factcheck.org states IRS policy deems volunteers to be employees for tax purposes if they receive a stipend. Known as the employer mandate, which was postponed and will now go into effect in 2015, municipalities with more than 50 full-time workers might be required to provide health insurance to volunteer “employees” or face a $2,000 per employee tax penalty.