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What are YOU doing about the Affordable Care Act

By Stephen Tweed

I’m writing to you today from the Tropicana resort in Las Vegas where we have been for a meeting of our $5 Million Home Care Mastermind Group, and the Decision Health Private Duty National Conference.

Tom Knox, CEO of SeniorCorp and founding member of the $5 MM Mastermind group was the opening keynote speaker for the conference did a wonderful job of explaining the research that his company did on the options to comply with the employer mandate in the Affordable Care Act.

According to Tom, there are four options for you to consider if you have 50 or more Full Time Equivalent employees:

  1. Cut and Cap – cut your caregivers to less than 30 hours per week and cap their hours so you are not required to offer health insurance.
  2. Pay the Penalty – you can pay a penalty of $2,000 per eligible full time employee (over 30 hours per week)
  3. Offer a MEC Plan – Minimal Essential Coverage – this plan avoids the ACA penalties but does not really provide your employees with significant health care coverage.
  4. Offer a Bronze Plan – Minimum Value Plan – The lowest cost plan that meets the affordability requirements of the ACA

What Other Companies are Doing

Then Tom shared the results of an industry survey conducted by Leading Home Care about what other companies in the industry are planning to do in 2016.  Over 220 companies responded to the survey, which gives us a valid sample.  Here’s what companies are planning for 2016:

Large Companies over 100 FTEs

  • Provide  Bronze Level Plan – 76.92%
  • Keep caregivers under 30 hours – 10.26%
  • Pay the penalty – 2.56%

Medium Companies with 50 – 99 FTEs

  • Provide Bronze Level Plan – 45.31%
  • Keep caregivers under 30 hours – 14.06%
  • Pay the Penalty – 15.63%
  • Reduce FTEs to less than 50 – 7.81%
  • Other – 17.19%

There were many comments under “other”, including a number of companies that are planning to sell or go out of business.

What SeniorCorp is Doing

SeniorCorp is a large private pay company in Virginia Beach, VA that providers more than 12,000 hours of care per week.  That volume of hours puts then in the top 4% of companies in the private pay sector.  Their strategy for the ACA is:

  1. Offer a Bronze level plan
  2. Offer a Health Savings Account with $3,500 deductible
  3. Use the “Rate of Pay” safe harbor
  4. Use an 11 month look back period
  5. Explain the company benefits and introduce caregivers to the Exchange
  6. Offer real benefits that are positive for employees

Analysis by Tom and his CEO, Andy Tysinger, show that this approach will have much lower economic impact on their company than originally expected.

Tom presented this program to the members of the $5 Million Mastermind at our meeting on Sunday, which generated two hours of discussion about the fine details of making this work.  This is a much more complex issue that many home care company owners realize.

Learn More from Tom Knox and SeniorCorp

As a service to the members of the Academy for Private Duty Home Care – soon to become the Home Care CEO Forum – Tom will be conducting a Virtual CEO Round Table in two parts in November and December.  The first session will be on Tuesday, November 24 at 4:00 pm eastern time.  The second session in the series will be on Thursday, December 17 at 4:00 pm eastern time.

Participation these Virtual CEO Round Table discussions is free of charge to Premium Members of The Academy for Private Duty Home Care.  Non-members can participate on a pay-per-view basis for $149.00 per session. (If you cannot attend live, go ahead and register and we’ll send you the recording afterwards.)  Click below to register.

Academy Premium Members click here (You’ll need to log-in and then go to the Online Learning page.  Also look for an email from Jill Scott with the registration link).

Non-Members Register here

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