Georgia County Government - Summer 2014 - (Page 34)

SPECIAL FOCUS: HEALTHY COMMUNITIES Counties and the Affordable Care Act: An Update on Federal Healthcare Legislation What should counties be doing now to maintain compliance with healthcare reform? By Rick Jones, CEBS, ARe SINCE THE AFFORDABLE Care Act passed four years ago in March 2010, there have been many changes to the healthcare landscape. Enhanced benefits, new taxes, and administrative requirements have increased costs. Many groups have responded by increasing deductibles and out-of-pocket costs. Even how many hours many employees are allowed to work have changed as a result of the law. Three of the largest changes counties now face include meeting the affordable coverage requirements, providing health insurance to all required employees including many part-timers, and managing costs to avoid the 40 percent excise tax on high cost plans, known as the Cadillac Tax, that begins in 2018. Because county workforces have a higher average age than the private sector this last one can be particularly challenging. Frequent changes in regulations and effective dates have made keeping up to date important. Each spring and fall the ACCG has offered seminars to provide updates to counties. Several of the changes have been very helpful to county budgets, such as removing the requirement for counties to pay for family  coverage, delaying the employer mandate, clarifying that volunteer firefighters will not be considered employees even when paid, and dropping the requirement to cover seasonal employees in most cases. 34 GEORGIA COUNTY GOVERNMENT Employer Mandate The "Employer Responsibility" requirements to offer health insurance vary based on how many employees an employer has, and include special rules on how to count. Counties with 49 or fewer employees and fulltime equivalents do not need to offer coverage at all. Those with 50 to 99 employees need to offer affordable coverage to at least 95 percent of their working staff members by renewal, usually July 1, 2016. If a county has 100 employees then at least 70 percent must be offered affordable coverage by renewal in 2015 and 95 percent by the 2016 plan renewal. The original effective date of 2014 was recently postponed. >> Frequent changes in regulations and effective dates of the Affordable Care Act have made keeping up to date important. Each spring and fall the ACCG has offered seminars to provide updates to counties. If you thought you had learned to count in kindergarten here's an update: to find how many health reform employees your county has, start by counting every full-time person as one employee. Then take all part-time employees that work at least 120 days a year, add up their total hours per week, and divide by thirty for how many full-time equivalents the county has. Thus two 15-hour-a-week employees equal one full-time employee for health reform purposes. The IRS allows rounding off at two decimal places, so 20 hours a week qualifies as 0.66 of an employee. Add all these up and hope the total is less than 50. If your county has over 50 employees and you fail to meet the 70 percent or 95 percent requirements, then there is a penalty tax of $2,000 per employee per year, even on the employees you buy coverage for with an exception of the first 30 employees, which are exempted. A county with 200 employees that only offered coverage to 90 percent of those required in 2016 would face a tax of $340,000 (200 employees - 30 = 170 x $2,000). Groups meeting the 70 percent or 95 percent threshold, but not reaching 100 percent could potentially have the few employees they do not offer coverage to seek subsidized coverage on the government's health insurance exchange. Each employee that actually receives a subsidy will result in a $3,000 tax penalty. A county can be confident of avoiding tax penalties if they offer affordable, good enough coverage to the required percentage of employees. The mandate is to offer coverage, it does not matter if the employee takes it or not. Also, the county offering appropriate coverage to an employee will make them ineligible for a subsidy on the health exchange. Almost all plans currently sold are "good enough" which requires a plan to pay at least 60 percent of total expected medical costs and have out-of-pocket costs not more than

Table of Contents for the Digital Edition of Georgia County Government - Summer 2014

President’s Message
Director’s Desk
County Focus: Walton County and Pragmatic Governance
County Wellness Programs: The Healthy Choice for Employees and Budgets
UGA Extension’s Walk Georgia Offers County Governments a Free, Online Option for Worksite Wellness
Counties and the Affordable Care Act: An Update on Federal Healthcare Legislation
Leadership Development: ACCG Gives County Officials ‘Tools’ to Make Better Decisions
News & Notes
Index of Advertisers

Georgia County Government - Summer 2014

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