By: Dan Cohen – 3/11/14
Last week, I spoke to a group of human resource professionals. The topic: “Recent Changes to the Requirements and Deadlines under The Affordable Care Act.” I did not prepare written materials in advance. I learned my lesson this past summer when I spoke to a group about the ACA. Literally as I was speaking, the SHOP Exchange delay was announced. A few months later, I was in Northern Michigan speaking to another group about ACA and it happened again. That day, President Obama extended the deadline for non-complying insurance plans a whole year in response to the outrage caused by all the cancelled plans. You probably remember all the fuss about his earlier misrepresentation that “If you like your plan you can keep it.” Well, they say, the third times a charm, right? It actually happened to me again earlier this week when HHS announced that any non-complying small business or individual health policy that begins on or before Oct. 1, 2016, can remain in effect. This means non-compliant plans can be in use well into 2017.
I am not a superstitious person, but it does seem that every time I speak about the ACA, Washington announces a change or delay. So, the question becomes: should I keep speaking about the ACA or should I refuse any additional invitations? All kidding aside, the ACA has been a moving target since day one. There have been at least 36 different changes and delays since it was passed. This should not come as a surprise: There are four different agencies (DOL, IRS, HHS, OSHA) interpreting hundreds upon hundreds of pages of text. Between the four agencies, they have managed to create in excess of 10,000 pages of guidance and interpretative regulations. How many have actually read every single page? This explains part of the problem. There is simply too much information to know. There is also a lot of misinformation out there. Just go to the internet and spend some time reading what some are writing about the ACA and you will get my point. And then there’s the political picture. As President Obama’s signature legislation, and mid-term elections coming up, his administration is feeling the heat to preserve the ACA, while delaying the wrath of voters until after the election.
March 31 is the next key date for the ACA. This is the current deadline for open enrollment through the health care exchange for the uninsured. Those who don’t enroll and remain uninsured after March 31 will be subject to individual mandate penalties. In 2014, the penalty is the greater of $95 or 1% of income. There has been a big push to appeal to the younger (under 30) crowd for the simple reason that the exchange needs nearly 3 million young and healthy persons by March 31. Otherwise, the plans will consist of older and less healthy individuals, which throw the cost of health care completely out of whack. This is why you see Magic Johnson on commercials telling young Americans that they need health care. It remains to be seen whether this deadline, which has already been extended, will be pushed out again.
The IRS just issued another round of regulations last month, which created a new category of employers: medium size. So, now there are small, medium and large employers, each with separate obligations at least for 2015. These regulations also changed the definition of a seasonal employee as well as other employee categories. As word and analysis of these regulations spreads, I suspect we will learn of additional uncertainties, changes and surprises. Nancy Pelosi was only half right when she said we had to pass the ACA to find out what was in it. Apparently, we had to pass it to find out what wasn’t in it, what was wrong with it, and what made absolutely no sense. Now, we must endure change, after change, after change and delay after delay after delay while Washington tries to clean up this mess.