The Edge - Q4, 2015 - (Page 11)

Business Feature POOL &SPA Company Owners Brace for Health Care Reform by David Oscar AS WE LOOK to 2016, businesses in the pool and spa industry are bracing for changes to the Affordable Care Act (ACA), which has already brought increased health care costs to many in the industry. A new survey by the International Foundation of Employee Benefit Plans (IFEBP) shows many American businesses think the largest health care cost increases are yet to come. According to the study: One-third of respondents think the biggest cost increase from ACA implementation will take place in 2016. That's because new reporting, disclosure and notification requirements will take effect. More than one-quarter (27 percent) think the largest cost hit is still on the horizon in 2018. That is when the full brunt of the ACA takes hold, when the so-called "Cadillac tax" takes effect, which is a non-deductible 40 percent excise tax on the most expensive plans. In 2018, that would be for coverage of $10,200 for self-insured and $27,500 for family coverage, and it doesn't matter if the premiums are paid by employers or employees. The survey identified what business owners consider to be their top compliance-related expenses over the next few years. Top concerns include: * The excise tax on the Cadillac plans (20 percent of employers) * All the costs that will go into complying with the new federal law (19 percent) * The expense of all the reporting, disclosure and notification requirements (13 percent). COMPLIANCE COSTS According to IFEBP researchers, employers need to devote significant time and energy to maintain compliance with the law. That equates to lost work time for many in the pool and spa business, who often are short-staffed during the seasonal spike. "The extensive amounts of data that employers are required to collect can take hours [of labor] and even require complex IT infrastructures," said Julie Stich, CEBS, director of research at the foundation. "This has meant a cost increase for many, especially smaller organizations." As a health insurance broker, it is disconcerting to me to learn that most employers - about 71 percent - believe the costliest years are yet to come, as many are already finding health insurance out of reach. Eighty-two percent say the law is increasing their organization's costs this year, with most projecting a one percent to six percent increase in what it costs to comply with this everchanging law. CONTROLLING COSTS The New Jersey Association of Health Underwriters (NJAHU), whose members work to ensure that clients pay the lowest premiums possible, make some important recommendation to control costs. These include: * Placing clients in high-deductible health plans (HDHP), which have lower premiums than other health plans and can help employers avoid the excise tax. * Coupling high deductible plans with a health savings account or a health reimbursement arrangement, both of which are designed to give employers and employees a break on the high premiums of traditional health insurance. "High-deductible health plans are proving a popular option among employers that are looking for a way to hold both current and future health care costs in line," said Stich. "As employers face the upcoming Cadillac tax, it's likely that HDHPs will continue to gain popularity." Just over half of the employers taking part in the survey are on pace to trigger the excise tax in 2018, but only three percent actually plan to pay the tax. Of those looking to avoid the tax, 53 percent have added or plan to add a high-deductible health plan. In addition, 13 percent report they will not incur the excise tax because they have already taken action to avoid it. IMPORTANCE OF HEALTH COVERAGE The study showed that three in five respondents believe the federal law is having a negative effect on their businesses. But nearly all of these employers - 96 percent - still plan to offer health insurance, even five years from now. To get the best and brightest in any industry, offering this perk is mandatory. "Health care benefits are seen as essential for attracting future talent and retaining current high-quality employees," said Stich. "Employers may change the structure of their health care plans or shift some of the cost burden to their employees, but it doesn't appear they will stop offering health care benefits anytime soon." To learn more about changes in health insurance, visit | David Oscar is a benefit consultant at Altigro Resource Group, LLC in Fairfield, New Jersey and a frequent speaker at The Pool & Spa Show powered by Northeast Spa & Pool Association. THE EDGE 11

Table of Contents for the Digital Edition of The Edge - Q4, 2015

The President’s Message
NOW HIRING! How to Recruit the Best Frontline, Hourly Employees
Pool & Spa Company Owners Brace for Health Care Reform
Are You Good Busy or Bad Busy?
Project Focus: Aquatic Artists
A Pool for All Backyards: Hybrid Design
Technical Questions Answered
Index of Advertisers

The Edge - Q4, 2015