Health Reform and the ACA: Are You Prepared for the New Normal?

Health Reform and the Affordable Care Act: Is Your Business Prepared for the New Normal?

Executive Summary by Robert N. Manning

The Affordable Care Act,  (“ACA”) is a massive overhaul of America’s health care system.  It will have a major impact on Brevard County’s businesses.  The law firm Dean, Mead, Egerton, Bloodworth, Capuano & Bozarth, P.A. is on the cutting edge of business planning for the ACA.  Dean Mead chose this hot topic for its inaugural seminar series titled, “Brevard Business Briefings”.

“Like it or hate it, local businesses are addressing the law’s requirements in their strategic business planning,” said Dean Mead corporate law attorney Claudia Haines Jones, the moderator of the discussion,  “Even though the Affordable Care Act has become like the third rail of political discourse, we decided to tackle it anyway because this is a game changer for our community.”

Dean Mead tax law attorney Charlie Egerton explained the ACA contains two mandates.  First, the ACA has an individual mandate that requires an individual to purchase insurance or pay a penalty.  Second, the ACA has an employer mandate that requires an applicable large employer (generally 50 or more full time employees) to offer an employer sponsored plan that offers minimal essential coverage, or pay a penalty.

The ACA also introduces the concept of health care exchanges, a clearinghouse for individual insurance plans that are eligible for federal subsidies.  Egerton said the challenge for businesses is to find the “sweet spot” in insurance coverage to discourage employees from going to the health care exchanges to purchase their own individual insurance plans.

Now is the time for businesses to begin planning for the ACA, even though the law doesn’t go into effect until 2014.  “These tests, which are tied to whether you are an applicable large employer, and whether you have more than 50 full time employees, are all determined on a look back basis.  So even though the date of implementation of the employer mandate is January 1 of 2014, the testing data that is going to be used to decide if you’re in our out, is occurring right now in 2013,” Egerton said.

Dr. Edgar Figueroa, Chair of Quality Management Committee at Holmes Regional Medical Center, said everyone who uses health care will notice the effects of the ACA.  “Patients will see the difference.  If… your end goal… is get the care that the patient needs at the right time doing the correct diagnostic procedures and delivering a better outcome, how can that not go unnoticed?”

George Mikitarian, President and CEO of Parrish Medical Center in Titusville has already overseen changes in hospital procedures to comply with the ACA’s  requirements.  Mikitarian sees many challenges ahead in the implementation of the ACA,  “It’s inherent in its conflicts because it’s still reimbursing providers– providers are nursing homes, physicians, hospitals and everyone else– largely for the amount of work they do, but trying to force us by law, to become more efficient and effective and ultimately accountable for the outcome of the care.  That is not just a legal transition that can occur by the implementation of a law.”

Many business owners in Brevard County are bracing for the ACA’s compliance deadlines. Scott Sorenson, President and CEO of the Sorensen Corporation, added a business perspective to the panel discussion.  One of Sorensen’s companies, Sorensen Moving and Storage, is considered a large employer that is subject to the requirements of the ACA.  Sorensen said the ACA will affect his company’s bottom line.   “If you’re a business person trying to survive in this environment, the challenges I see are that it’s another burden on business to administrate, keep track and watch, what the threshold is, the minimum we have to meet with each employee,” Sorensen said. “It’s a moving target.”