Employers watchful over AHCA implications

This piece is presented by Howalt+McDowell Insurance, a Marsh & McLennan Agency LLC company.

With the recent passage of a revised version of the American Health Care Act in the U.S. House of Representatives, many employers are wondering what effect the proposed changes will have on their business.

According to Marathas Barrow Weatherhead Lent LLP, a national law firm with recognized experts on the Affordable Care Act, the most significant change the AHCA makes to the ACA for employers is to repeal the employer mandate penalties effective Jan. 1, 2016.  Other significant changes are unlimited flexible spending accounts and enhancements to health savings accounts. For individuals, the most significant changes include the repeal of the ACA’s Medicaid expansion and its premium subsidies and cost-sharing reductions for low-income individuals.

Abbey Vanderwerf

Abbey Vanderwerf is the operations manager for employee benefits at Howalt+McDowell Insurance, a Marsh & McLennan Agency LLC company. Vanderwerf said many of the agency’s clients have expressed a mixture of fear and anxiety over the proposed changes. She cautions employers that in every scenario there are possible winners and losers and to choose their information sources wisely.

“The media does a lot of reporting on certain points of the proposed AHCA, but it’s important to remember to keep things in context. It’s easy to focus on things and jump to conclusions without understanding the total story,” Vanderwerf said. “Employers and individuals need to find trusted and reliable resources to help keep them abreast of the changes and ensure they are getting accurate information.”

Vanderwerf recommends nonpartisan sources such as the Kaiser Family Foundation, a nonprofit organization focusing on national health issues. A side-by-side comparison of the ACA and the AHCA is available on its website.

“In addition to independent, online resources, your insurance broker should serve as a trusted adviser and provide consultation that is appropriate to your specific circumstances,” Vanderwerf said.

Not all employers are overly concerned with the bill affecting the way they do business. Jeff Tornow is the chief financial officer at Electronic Systems Inc. in Sioux Falls.

“What matters to us is what the local labor market is doing. Regardless of whether or not the AHCA mandates that we must offer health insurance coverage, we will offer coverage if the companies that we ‘compete against’ for employees are offering health insurance coverage,” Tornow said. “We need to have a competitive benefit package in order to attract and retain employees even if there is no pay-or-play provision in the new health care law.”

The AHCA still has to pass the Senate before arriving at the president’s desk to be signed into law. While the future of the AHCA in the Senate is uncertain, South Dakota’s senators, John Thune and Mike Rounds, have indicated their support for the proposal, with intentions to press for further changes.

“It’s not perfect, and I would like to see improvements, including a transition plan for folks closing in on retirement, clear assurances on how we’ll handle pre-existing conditions and stronger promotion of group insurance plans because that is the most effective delivery system we have,” Rounds said.

In a statement on his website, Thune said he believes that by making some common-sense adjustments to the bill’s tax credit, more targeted relief can be delivered to Americans who need it the most.

Marcus Wilbers, vice president of compliance consulting at J.W. Terrill, a Marsh & McLennan Agency LLC company based in St. Louis, advises that the Senate is expected to take its time to consider potential changes and that it’s premature for employers to begin trying to determine what the AHCA means for their business.

“It is too early to determine what – if any – changes the Senate will make to the AHCA,” Wilbers said.

Employers watchful over AHCA implications

With the recent passage of a revised version of the American Health Care Act in the U.S. House of Representatives, many employers are wondering what effect the proposed changes will have on their business.

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