What if home health care agencies, funded by Medicaid, collapsed all across the country under the weight of the Affordable Care Act’s penalties in the “employer shared responsibility for health care coverage” section? William A. Dombi, executive director of National Council on Medicaid Home Care, says “We need to start an advocacy fire under this issue,” as access to care will be in serious jeopardy.
A timely action link below should be forwarded to any and all small business owners, not only to owners of home health care agencies. There is a rapidly closing window when public comments on this issue may make a difference--but this is the best kept secret in Washington!
A recently completed nationwide survey of home care companies on the potential impact of the employer penalties under the ACA clearly shows that home care access will be in peril and that workers will be hurt as well, with employers curtailing working hours to try to avoid the penalties. Dombi says the problem is especially acute with Medicaid home care providers, where payment rates are far from sufficient to allow for an employer-paid health insurance or coverage of the penalty.
Dombi said, in meeting recently with Treasury and Health and Human Services, that it makes no sense to use Medicaid dollars to pay a government penalty. This would take health care monies and turn them into general tax dollars.
To put a human face on the issue, consider the case of a young father, who used an SBA as well as a family loan to purchase a home health care company in Arizona. With one hundred employees, the penalty for not providing coverage would amount to four times the owner’s own salary. While his preference would be to provide affordable coverage, he was quoted a per employee price of $6,000—three times the penalty. Because his company carries debt, paying the penalties alone would put him on the verge of bankruptcy.
SHOP—the small business health insurance marketplace—is not due to go online until October 1, 2013—only three months before the penalties kick in. But even if the marketplace were to provide affordable coverage at less than the cost of the penalty, a small business with over fifty employees would not be allowed to use that marketplace until 2015—too late for most of these Medicaid-funded companies.
What will become of the 100 caregivers? What will become of the 90 clients who require home health care? And what of the small business owner who will be forced to default on both loans and declare bankruptcy? Multiply this one company by innumerable companies across the nation whose future will be imperiled without a legislative “fix,” an executive order, or an interpretation of the IRS ruling that controls penalties.
It is unclear whether President Obama himself is aware of this unintended consequence of his signature achievement in his first term.
Julie Veratti of the Small Business Administration offered one possible glimmer of hope to small businesses in a state of panic. The IRS Regulation (REG-138006-12) that will enforce this aspect of the ACA has not been finalized yet. Though the opportunity to make public comments on the issue is a well-kept secret, they are welcomed into the public record, but only until March 18th. A public hearing on the final regulations will be held in the Auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW, Washington, DC on April 23, 2013 at 10 a.m.
Small business owners need to know that they can make public comments, by referencing REG-138006-12 at the Federal eRulemaking Portal at http://www.regulations.gov, or by going directly to: http://www.regulations.gov/....
It is important to attach a file with the company’s entire comments, as messages are truncated and content will otherwise be lost.
In Congress, Sen. Tammy Baldwin (D-WI) along with co-chairs of the Congressional Home Health Caucus—Rep. Jim McGovern (D-MA) and Rep. Walter Jones (R-NC), have been apprised of these unintended consequences of the Affordable Care Act. Baldwin, as a congresswoman, was involved in the writing of the legislation and has been keenly involved in issues regarding seniors. But will these and other members of Congress bring enough heat and light to the issue to effect a fix before the penalties take effect January 1st? William Dombi sees “a great reluctance to amend the ACA.”
Nevertheless, for the sake of small businesses, employees, clients, and investors, the Arizona small business owner remains hopeful the media will play an important role in bringing the heat and the light to which Dombi alluded.