When a recent hire became eligible for benefits with A&M Corson’s AquaValue, she was unsure if she should opt for the company’s health plan.
The U.S. Supreme Court had handed down a decision on June 28 to
affirm the constitutionality of the Patient Protection and
Affordable Care Act, and AquaValue’s employee, a single
mother, wondered if purchasing a policy from a state-run exchange
would be more affordable.
Ultimately, she chose to stick with her employer’s benefits
“Our human resources manager said she would be a lot better
off signing up here after outlining what she would get for buying
through us,” said Greg Boyer, vice president of the
Phoenix-area pool company, which covers 50 percent of the insurance
costs for its 42 employees.
Boyer’s new staff member is one of millions of Americans who,
by Jan. 1, 2014, must be insured either through their employers or
by purchasing policies from state-run exchanges.
Despite intense media coverage of the act, many questions remain
about how the exchanges will operate and be funded, as well as the
financial effect on companies and individuals.
“We don’t even know if the act is ever going to succeed
due to all the opposition and, if it does, what will the final act
look like?” said Thomas Brown, executive vice president,
Society of Pool Building and Retailing Professionals.
“Until the act is complete and both sides of the argument
have come to an agreement, it’s very difficult to understand
how it’s going to affect individual businesses like a
retailer or a pool builder.”
However, one thing is certain: There are several items that dealers
will be responsible for sooner rather than later to comply with the
act. For example, more information will need to be tracked and
reported. Starting in 2013, employers must state the value of their
insurance coverage on their employees’ W-2 forms, according
to the Society for
Human Resource Management. They also must cap the dollar limits
on their plans’ Flexible Spending Accounts, or FSAs, at
$2,500, and increase what they withhold for Medicare from the
paychecks of employees with incomes of $200,000 or more.
Employers should be aware, too, that when the act goes into full
effect in 2014, it limits employees’ deductibles and
out-of-pocket expenses, as well as capping the waiting period for
an employer to add a new worker to its health care plan to 90
Without question, one of the biggest choices dealers will make in
the next 15 months is whether to continue offering health insurance
to employees, or to move them into exchanges.
That decision could differ for every company. For example, the act
mandates that all businesses with 200 or more employees
automatically enroll their workers into a company-sponsored health
insurance plan, though employees can opt out and go into an
On the other hand, companies with fewer than 25 employees will be
eligible for tax credits if they insure their workers and pay for
at least half of their premiums.
Companies with 50 or more employees are required to offer
insurance, move employees into exchanges or pay a penalty of $2,000
per employee per year. (The first 30 workers are exempted from that
Employer-sponsored insurance could become less attractive by 2018,
when the act imposes an excise tax on so-called
“Cadillac” plans that are valued at more than $10,200
per individual and $27,500 per family.
Still, many dealers seem reluctant to dispense with health
insurance, which they view as a recruitment and human resource
tool. Boyer is one of them. “Insurance ... gave us better
personnel, and we are certainly going stay on that road because
we’ve got some great people and it’s worked,” he
Making a definitive decision won’t be easy for many, so Boyer
and others suggest working closely with an expert.
“You can’t figure it out without a consultant,”
said Stuart Neidus, president/CEO of Anthony &
Sylvan, which currently provides a comprehensive benefits plan
for its several hundred employees. “You need to get expert
help. It’s way too complicated for people who don’t
John Caulfield and Erin Ansley contributed to this