News and Tribune

Business/Money

July 24, 2013

Uncertainty of health insurance concerns business leaders

Panelists at forum explain impact of federal health care reform for businesses

NEW ALBANY — Abby is a 34-year-old single woman earning $75,000 annually, and she will be taxed $1,875 beginning in 2016 by the federal government if she doesn’t obtain health insurance.

This hypothetical example was one of several scenarios laid out Wednesday by regional medical, insurance and legal experts during a forum focused on how the Affordable Care Act will affect businesses.

Abby was a case study provided by John Rittichier, vice president of the tax department for Harding, Shymanski and Company, as he detailed some of the multiple changes the federal legislation will force employers and employees to address.

“There’s definitely a new tax regime,” Rittichier said.

The forum, at Northside Christian Church on Charlestown Road, was organized by One Southern Indiana, and though the issue of national health care has been heavily debated, officials said the meeting wasn’t intended to be political.

One Southern Indiana President Wendy Dant-Chesser said the Affordable Care Act has created some uncertainty among employers and the forum was a way to help answer some of those questions.

“The idea is to give them as much information as we can as it becomes available,” she said.

The delay in implementing the employer mandate was one of the focal topics of the forum.

Employers paying 50 or more full-time workers will be fined if they fail to offer health coverage beginning in 2015 instead of 2014 as ordered by President Barack Obama.

“There is actually current controversy over whether the Obama administration was right” to delay the penalties, said panelist Ozair Shariff, an attorney with the firm Stites and Harbison.

He added he feels it was a prudent decision by Obama to delay the employer mandate portion of the bill.

However, many Republican members in Congress have challenged whether the White House has the authority to delay only a portion of the measure, as several have called for the entire legislation to be postponed.

There have been several rumors circulating about the Affordable Care Act effect, and the panelists attempted to dispel or confirm some of those questions.

But they also conceded there are some details of the legislation that remain unclear.

For example, Joe Gilbert, regional vice president of individual and small group for Anthem BlueCross/BlueShield of Indiana, posed one of the more common questions he receives about the plan: How much will the new coverage cost me?

“Everybody wants that number,” Gilbert said. “The answer is it’s not a simple answer.”

Factors ranging from existing medical plans to the community rating for individual states will play parts in determining insurance costs.

It’s easier to forecast how hospitals and insurance companies will be affected by the Affordable Care Act, Gilbert said.

“We believe that 60 to 70 percent of the population is subsidy-eligible” in Indiana, Gilbert said.

With more than 840,000 Hoosiers uninsured currently, Gilbert predicted “a lot of action” in the health insurance and medical community once the entire reform takes hold.

“We believe the hospitals are going to be busy,” Gilbert said.

That belief is so strong that he added insurance and medical officials have advised customers and patients to book appointments with their physicians well in advance to ensure they’ll be treated expeditiously.

Another issue facing Indiana hospitals involves Gov. Mike Pence’s challenge of the Medicaid expansion as part of the Affordable Care Act.

When portions of the legislation went into effect in 2010, hospitals began surrendering government payments in programs such as Medicare to aid in footing the Medicaid expansion.

But those Medicaid dollars may not flow back to Indiana hospitals if the federal government doesn’t award Pence’s waiver request.

The waiver calls for the state to expand its Healthy Indiana Plan via Medicaid funding to cover the newly uninsured Hoosiers who would qualify for benefits under the federal plan.

Pence prefers the Healthy Indiana Plan to expanding traditional Medicaid in the state. The primary difference in the plans is that Healthy Indiana requires those covered to chip in 5 percent of their annual income to a health savings account.

Proponents of Medicaid expansion have said the move would quickly increase funding for Indiana hospitals.

The federal government hasn’t ruled on Pence’s waiver, but did decline a similar request from former Gov. Mitch Daniels.

State Rep. Ed Clere, R-New Albany, was the moderator of the heath care forum. He said he’s urged Pence’s administration to consider Medicaid expansion, though he added he understands the governor’s concerns over enlarging the federal program.

“Hopefully there will be an opportunity for some give and take,” Clere said.

More than 20 states stand to receive a sizable flow of federal dollars beginning on Jan. 1 because they’ve accepted the Medicaid expansion, Clere continued.

“We know that in the health care economy, a lot of that money stays in the community,” he said.

 

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