WANADA briefing clarifies what is and is not known about ObamaCare

WANADA briefing clarifies what is and is not known about ObamaCare

WANADAs member briefing August 21, 2012 on the Patient Protection and Affordable Care Act of 2010 (PPACA, a.k.a. ObamaCare) unearthed numerous ambiguities and unresolved aspects of the far reaching, controversial new law, while at the same time clarifying established requirements and debunking the myriad of myths perpetuated mainly by the media. WANADAs executive vice president John ODonnell moderated a diverse panel of knowledgeable professionals who have been or will be engaged in the rollout of ObamaCare. The panel presented specific elements of the law in the context of employer obligations to employees to provide or assist in obtaining affordable healthcare coverage when the law is implemented in 2014.

The panel, consisting of Rodger Bayne, vice president, Group Benefit Services; Cheryl Risley Hughes, Esq., Groom Law Group; Richard Morris, CPA, Councilor, Buchanan & Mitchell; and David Regan, Esq., vice president of legislative affairs, NADA, also spawned a lively discussion with a room full of WANADA dealer executives over the course of the entire morning. For example — Will employers remain in the business of providing healthcare coverage to employees? Yes, even more so. Will employees be obliged to obtain coverage? Yes, all of them. Are dependents (families) part of ObamaCare? Not entirely clear. Will state healthcare coverage exchanges supplement employer provided healthcare coverage? Yes, in a supportive, last resort manner.

Two big picture components of the law that were recurring themes in the briefing:

1. Employers will play a large and predictably more costly role in implementing ObamaCare being responsible for seeing to it that their employees receive affordable healthcare coverage; and

2. The federal government will play a new, expansive roll in workplace inspired healthcare coverage that the Congressional Budget Office estimates will add 35 million people to an already strapped Medicare system predicted to hike up the $16 trillion federal deficit an additional $1.5 trillion by 2021.

We have about 17 months between now and 2014 for everyone to figure out healthcare reform and WANADA and our insurance operations are committed to doing that for our dealers, said ODonnell in his opening remarks, acknowledging that ObamaCare is still very much a work in progress.

To no ones surprise, the impending elections and who will control Washington was a discussion topic early in the briefing given the pivotal importance of the election in determining the course of ObamaCare.

The elections will dictate what is practically possible on healthcare, said panelist David Regan, NADA vice president of legislative affairs. A Republican sweep would offer more flexibility in dealing with the law, but it would still be very hard to repeal it, he said.

Many questions about the law wont be answered until after the elections, and most provisions wont take effect until January 1, 2014. But one thing is for sure: State Exchanges are going to be a regular part of your life, according to ODonnell. Each state will have a healthcare exchange. If a state resists, the federal government has said it will set one up in the state. Regionally, Maryland is moving ahead quickly on its exchange, while Virginia is drawing the process out; DC will definitely have one.

As of January 1, 2014, employers with 50 or more full-time employees (averaging at least 30 hours a week) must offer essential coverage and affordable care that will be determined by the law. Affordable care is defined as the employer paying at least 60% of the cost of coverage, with the employee paying less than 9.5% of his or her income as shown on the W-2. Two half-time employees would be considered the equivalent of one full-time employee under the law.

Starting in 2014, additionally, employers that offer healthcare coverage and have more than 200 employees will be required to enroll employees in their plan. These employers can offer employees the opportunity to opt out and use the state exchange instead, however.

An employers penalty for failure to comply with either of these two provisions can be up to $3,000 per employee.

What do dealers need to do in 2012 and 2013 to comply with the law?

As of March 2012, all employers should have received a summary of their existing healthcare benefits from their insurance carrier which in turn needs to be distributed to employees.

If your dealership has received a rebate from the carrier, you can either divide it among employees proportionate to their premium payments or use it to offset future premiums. WANADA recommends the second option as the best approach.

All dealers should start offering health insurance waivers that would go to employees such as those receiving healthcare from a spouses insurance plan. WANADA offers a standard form for this. This waiver helps the dealership track who has insurance & who does not.

By March 1st of next year (2013), employers are on deck to notify their employees of the existence of the state exchange and offer certain information about it, such as eligibility.

To be continued was the briefing panels farewell to the dealers, which ODonnell said would include more member briefings, alerts and bulletins. Click here for the WANADA ObamaCare Briefing Synopsis that was handed out to attendees at the August 21st meeting.