By Stephen Tweed
Well. It’s here! It’s time to begin enrollments for the Employer Mandate in the Affordable Care Act. Beginning in January, you will be required to provide a health insurance plan for your employees if you have 100 or more Full Time Equivalent employees (FTEs). How are you going to handle the requirements and the penalties for non-compliance.
Here’s a quick review the the law and the regulations:
- Large companies – those with 50 or more FTEs – will be required to offer “affordable” health insurance plans for all employees working 30 hours per week or more
- Full Time Equivalent, or FTE, is the number of full time workers who work 30 hours per week or more, plus all hours worked by part-time workers divided by 30.
- Full Time Worker is a person who works 30 hours per week or more
- To be affordable, the employee’s share of the premium cannot exceed 9.5% of their household income
Let’s look at the penalties:
- If you offer coverage, you will pay a penalty if at least one of your employees receives a federal insurance subsidy from the state insurance exchange. The fine is the lesser of $3,000 per subsidized employee or $2,000 per FT Employee minus 30.
- If you do not offer coverage and at least one employee receives a federal subsidy, you will pay a penalty of $2,000 per Full Time Employee ( 30 hours per week) minus 30.
(The minus 30 in the formula refers to the factor in the law which says you are only required to pay the penalty for more than 30 employees)
The Mandate Delays.
Originally in the law, employers were supposed to begin coverage in January of 2014. Because of the challenges with the individual mandate, the government issued a delay in requiring companies to provide coverage until January of 2015. Then, more problems with the health care exchanges caused them to issue another delay for companies with 50 to 99 FTEs. If that’s your company, you will have another year before you need to offer coverage – until January 2016. However, if you have 100 FTEs or more, your mandate begins in January, 2015.
What are other companies doing?
We worked with Home Care Pulse and the National Private Duty Benchmarking Study to find out how home care company owners are planning to respond to the employer mandate. There are basically four choices for courses of action:
- Provide Insurance as required
- Keep my company under 50 FTEs
- Keep my caregivers under 30 hours per week
- Pay the Penalty
In the most recent survey of company owners, here is how they responded:
- Don’t know – 52.6%
- Under 30 hours – 19.9%
- Provide Insurance – 18.7%
- Keep company to less than 50 FTE’s – 17.4%
- Pay the Penalty – 9.4%
What are Industry Leaders Doing?
Nearly every company owner in our industry is right now pondering these decisions and making plans for January. The Home Care Association of America is staying on top of these trends, and will be hosting a pre-conference seminar on this topic before their annual conference. They have asked me to do a presentation on the Affordable Care Act and the Employer Mandate, and to give some information on what leading companies in the industry are doing.
Better than reporting on what they are doing, I decided to bring them in to explain in person. I have put together a panel of three leaders in private duty home care who will respond to questions in my presentation, and will then engage with the audience on how to deal with the Employer Mandate. You can be part of that conversation by joining me in Kansas City, MO on Sunday, October 12, 2014. From 10:45 am to 12:15 pm we will be having an in-depth conversation that will give you specific concrete solutions to this challenge.
- Peter Ross, CEO of Senior Helpers franchising, and current President of HCAOA
- Tom Knox, CEO of SeniorCorp in Virginia Beach, VA
- Angela Landmesser, CMO of Partners in Senior Care, Grays Lake, IL
For a copy of the Conference Brochure, CLICK HERE.
To Register for this pre-conference workshop, go to the Home Care Association of America web site, and click on the link for the Conference Registration. You can register for the pre-conference, for the main conference, or a conference bundle.
Navigating the Storm of Overtime
In addition to the presentation and panel discussion on health care reform, we will also be doing a session on dealing with the elimination of the Federal Companionship Exemption which means that every agency will have to pay overtime for caregivers who work more than 40 hours per week. This will have a major effect on companies that provide live-in care. If you offer Live-in care, or if you have caregivers who are working more than 40 hours because they have a client who loves them, you’ll want to be in this workshop. It will be part of the HCAOA pre-conference workshop, and will be from 1:30 to 3:00 pm on Sunday, October 12, 2014. If you register for the pre-conference workshop, you can attend this program as well.
Our panel for this discussion will be:
- Andy Tysinger, COO, SeniorCorp, Virginia Beach, VA
- Andrew Huber, COO, Martha’s Hands, St. Louis, MO
- Angela Landmesser, CMO, Partners in Senior Care, Grays Lake, IL.
Lessons from the Top 5%
What do the big guys do that are different from the rest of the industry? For the past two years we have been privileged to host the $5 Million Mastermind Group at The Academy for Private Duty Home Care. This is a group of five home care companies that provide more than 5,000 hours of care per week. These companies are in the top 5% of all companies in the home care industry according to the 2014 Private Duty Benchmarking Study from Home Care Pulse. We have identified six lessons that we have learned from comparing these Top 5% companies to the rest of the industry.
To help you learn from their experience, three members of the Mastermind Group will serve as a panel to describe and discuss the six points of learning. Our three panelists are:
- Tom Knox, CEO, Senior Corp, Virginia Beach, VA
- Andrew Huber, COO, Martha’s Hands, St. Louis, MO
- Jake Fackrel, CEO, Alta Home Care, Riverside, CA
I will be presenting this workshop, and interviewing our panel, during the regular HCAOA Leading Conference on Monday, October 13, 2014 from 1:30 – 3:00 pm.
As you can see, there is a lot going on during this volatile time in home care, and there are lots of answers to be had from EOP – “Other People’s Experience”. If you are serious about growing your home care business, and you want answers to the employer mandate and the overtime exemption questions, then you will want to join us in Kansas City, MO on October 12, 13 & 14 for the Home Care Association of America annual Leadership Conference. See you there.