Earlier this month, The U.S. Treasury announced the federal government is postponing the employer mandate provision of the Affordable Care Act for one year. However, other elements of healthcare reform are about to take effect, most notably enrollment in and the launch of state health insurance exchanges. When healthcare reform passed in 2010, the legislation stated numerous components will be implemented by 2014. With the U.S. Departments of Labor, Health and Human Services having already issued final rules regarding employer wellness program requirements under the ACA, the recent delay may provide public employers additional time to prepare for administering employee benefits under the new legislation.
Yet, many public workers now need to chose whether to enroll in their state’s health insurance exchange come Oct. 1 or wait and see how their employer chooses to budget for the upcoming year. Numerous states and local governments are already putting together fiscal budgets to identify spending cuts, but with the employer mandate provision pushed back another year, it may be difficult for many public employers to estimate future spending.
Workers face numerous obstacles
According to the American Medical Association, experts suggest employees may decide to wait a year until the employer mandate provision is in place before choosing their health insurance to ensure they receive the best available plan. Kaiser Health News reported the individual penalty for employers with more than 50 full-time staff members will still be in place if workers do not obtain health insurance. KHN advised it may be more beneficial for employees to take part in health insurance exchanges or communicate with employers about their health plans for the coming year to avoid having to pay a fine.
Paul Ginsburg, president of the Center for Studying Health System Change, told KHN that most workers will not see their employer drop coverage this next year or the year after, as many who already provide insurance have done so since before the requirement passed as part of the ACA.
“For people whose employers already offer coverage, they’re doing it for a reason, and that reason still exists,” Ginsburg said.
While many claim the delay will give employers more time to understand and implement changes mandated by healthcare reforms to avoid penalties, the confusion for employees about what to do still persists. According to NBC News, new reports have surfaced that found employer-sponsored benefits have not decreased as a result of healthcare reform, but without additional details about how employers and insurers can work together to find a solution, employees may start to feel the effects in their benefits.
However, recent economic improvements promise more revenue for states, which may increase budgets and provide additional resources for employee compensation. NBC News reported an estimated 160 million people receive their healthcare coverage through their employer. With many Americans working in the public sector – which relies on numerous revenue streams to operate – states may take the next year to determine how they’ll continue providing current and future employees with health benefits and pension plans.
While the impact of the delay may not be felt until the state health exchanges are underway, public employees who already receive healthcare coverage may not be able to determine how their employer will juggle future related issues.
Robert Doherty, senior vice presidents for governmental affairs and public policy with the American College of Physicians, told AMED News the exchanges may allow employees to understand the advantages of participating in their employer-sponsored plan.
“Health plans offered through the exchanges will have to meet certain requirements relating to provider network availability that may differ from the insurance offered to their patients by employers,” Doherty said. “The payment rates and contracts may be different.”