Sometimes I hate being right
The Patient Protection Affordable Care Act (ACA or Obamacare) was passed in a rush in March 2010. I will not comment on the main aspects that are currently a subject of much discussion and a factor in the political log jam in DC.
Two aspects that I thought then were stupid have been getting more notice recently.
1. The ACA established the Independent Payment Advisory Board (IPAB). The IPAB is to be a committee of 15 that would make health care payment decisions that previously were made by the 535 people elected to do so as part of their job duties. Now some of the members of both parties have awakened to the fact that they had given some of their power away. Power to the IPAB is not something that any of them believe in. The funny part is given the log jam any fix to this may not happen.
Send your resume to The White House if you wish to be appointed to the IPAB. The IPAB starts meeting soon. The job pays about $165,300 a year not including benefits.
2. Beginning in 2018 companies will be taxed on paying more than $10,200 in a year for an employee’s health insurance. Congress called these plans Cadillac health plans. Among the factors for group insurance is the size of the group and the age of the members. At Boyd & Nicholas, Inc., the size of our group and the age of our employees already has us paying more than that per person for an HMO group. Did Congress not think that If we, and others in similar circumstances, have to pay additional taxes for providing employee health insurance that the coverage may be eliminated? The choices are to have a health plan with large deductibles or no plan. The tax to the business is 40% of the amount over $10,200 paid by the employer and the employee in total.
The employer requiring the employee to pay more of the expense will not eliminate the tax. The small employer dropping the health insurance will stop the tax. The large employer will retreat to poorer and cheaper health plans to avoid the tax as will many of the small businesses.