A lot more paperwork
Reform promises sea change for employers
Employers large and small face monumental changes to their business practices as a result of the new healthcare reform law—including added administrative work and reporting challenges. These changes are coming rapidly, too, with the first new requirements within six months, and won’t let up for the next decade.
“This is the biggest change in 30 years,” said J.D. Piro, principal in the health law consulting practice of Hewitt Associates. Not since the passage of the Employee Retirement Income Security Act, ERISA, in 1974, have employers faced so many new regulations on employment benefits, he added.
Yet many of the details about these new requirements are still unknown as HHS must draft detailed regulations on the law’s provisions.
“This is bigger than anything we have seen, but it also lacks a lot of detail,” said Amy Bergner, principal at Mercer, a consulting firm.
March 23 was the day President Barack Obama signed the Patient Protection and Affordable Care Act into law—and it also started the six-month countdown to when the first of the law’s health-plan standards go into effect.
By Sept. 23, employees’ children up to age 26 who don’t qualify for other health coverage will be eligible for dependent coverage under their parents’ health plan. Also in six months, health plans can no longer impose lifetime dollar limits on medical spending or restrict annual dollar limits on care.
Employers will be responsible for checking to make sure dependents up to age 26 don’t qualify for other health plans before adding them to their rolls. And employers will be looking to HHS for guidance on the annual dollar limits on health spending, as well as the lifetime cap elimination. Some small employers may qualify for tax credits to help cover the cost of employee health benefits.
Also this year, new health plans face a raft of restrictions on cost-sharing requirements, claims appeal processes and access to primary care. Under the reform law, “grandfathered” health plans don’t face these new rules this year. But, right now, no one quite knows what plans qualify as grandfathered. HHS has 90 days to issue these rules.
“The law is pretty clear that you don’t lose your grandfathered status based on eligibility changes,” said Christopher Sears, who specializes in health and employment law as a partner in the Indianapolis office of Ice Miller, a law firm. “But the law doesn’t discuss at all benefit changes that might affect grandfather status. It really is kind of silent on that issue.”
Piro: “This is the biggest change in 30 years.”