Archive | State Health Exchanges

WellPoint Sees Small-Business Plans Slip Ahead of Health Law

WellPoint Inc., the second-biggest U.S. health insurer, said more small employers are scaling back benefits this year, a potential hedge against higher costs expected under the U.S. health care law.

  • While small businesses have been cutting back for years, the pace has quickened in 2013, WellPoint Chief Financial Officer Wayne DeVeydt said in a phone interview. Fewer individuals are buying plans outside of work as well, possibly because they expect a better deal when the law’s insurance subsidies debut in January, he said.
  • “We continue to see the pace actually accelerating,” DeVeydt said in an interview after the Indianapolis-based company announced quarterly earnings. “Is it accelerating because people are willing to go naked, so to speak, before the beginning of the year? There’s really no way to say for sure.”
  • The number of American workers holding full-time positions fell in June as part-timers hit a record after rising for three straight months, according to the Bureau of Labor Statistics household data. Part-time employment has been outpacing full-time job growth since 2008. Economists cite tough economic conditions as the root cause, with some saying President Barack Obama’s 2010 health care law exacerbates the trend.

*Modified from an Insurance Networking News article

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Union Fears ‘Destructive Consequences’ From Obamacare

The laborers union has added to organized labor’s drumbeat of dissatisfaction with the Affordable Care Act.

  • In a letter sent to President Barack  Obama on Thursday, Laborers International Union of North America President Terry O’Sullivan wrote that the law has “destructive consequences” for the types of health plans that cover millions of unionized construction workers and their family members.
  • The letter follows a separate one written last week by the heads of the International Brotherhood of Teamsters, the United Food and Commercial Workers and Unite Here, expressing similar concerns to Congress’s top Democrats, Sen. Harry Reid and Rep. Nancy Pelosi. The International Brotherhood of Electrical Workers took out print ads raising alarms about the law last week as well.
  • Mr. O’Sullivan zeroed in on some factors that could directly impact unionized construction workers who are typically covered by multiemployer plans. He noted that costs are rising for such plans because of the law’s benefit mandates. Moreover, a tax under the law would cost such health plans $63 per covered individual, or $630,000 for a plan covering 10,000 people, he wrote. The proceeds of the tax will be used to subsidize insurance companies offering health plans in the Health Exchanges.
  •  “In effect, ACA takes money from the pockets of each laborer covered by a health and welfare fund and gives it to for-profit insurance companies,” Mr. O’Sullivan wrote. Those added costs will eventually impact collective bargaining agreements, he said, making union construction companies less competitive than nonunion ones and resulting in less work for union laborers.
  • Mr. O’Sullivan concluded: “Approximately 3 million laborers, retirees, and their families now face the very real prospect of losing their health benefits. This, I must remind you, was something that you promised would not happen.”

The laborers union, with about 570,000 members, is one of a few major unions that didn’t support enactment of Affordable Care Act, Mr. O’Sullivan reminded Mr. Obama. “Now, we have watched as the implementation of the law has progressed, our fears have become reality,” he wrote.

*Modified from a WSJ.com article

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Price, Price, Price: Health-Insurance Shoppers Have Priorities

The federal health overhaul’s big requirement that most people carry health insurance is still months away, but already insurers like Blue Cross & Blue Shield have a sense of what will matter most to consumers: price.

  • “To me, it’s all about money,” said Rob Roy, who compared plans in a consumer test for the insurer. Currently uninsured and working as a cook in a pub, Mr. Roy said he found the choices too expensive. He ended up opting for a competitor’s plan instead of Blue Cross.

To figure out who’s going to show up for the new marketplaces and what they want, companies have plunged into research. They have been setting up simulated exchanges for consumers to test-drive. WellPoint Inc., the insurer that may end up with the biggest presence on the exchanges nationally, has put about 55,000 people through these faux exchanges.

“You’re going to try to have a population of individuals who have never purchased this product,” said Raymond Smithberger, who oversees individual health plans at Cigna Corp. “It’s like buying a brand-new car if you’ve never driven before.” Cigna used the online simulations to help decide which state exchanges it would join, and to shape some elements of its coverage design.

  • Simulations by firms like Stonegate Advisors LLC, which conducted the insurer’s test-drive, have found that consumers often choose plans fairly quickly, without always looking in-depth at the benefit details. People with more health problems wanted richer coverage so they wouldn’t have to pay much to go to the hospital or doctor’s office.
  • Still, the focus on price, including the effect of subsidies, is a constant. Consulting firm Booz & Co.’s pretend exchanges showed that premiums were the most important factor in plan selection, followed by cost-sharing features like deductibles. McKinsey & Co., which tested about 150,000 consumers, found most would opt for smaller arrays of doctors and hospitals to achieve discounts.
  • “People were willing to trade off network access for price,” said Shubham Singhal, a McKinsey director who leads the firm’s health-care practice.
  • Blue Cross found the monthly premium was the most important thing for 48% of people, and one of the most important things for another 26%. It dwarfed other factors like prescription-drug coverage and copayments for doctor visits.
  • Blue Cross sponsored the simulated exchange last fall to get “a real-life glimpse into how people will behave,” said Jim Gallagher, the insurer’s vice president of marketing. The company tested around 500 people, but it struggled to enlist Hispanics, a key demographic; only four completed a Spanish-language version of the simulation.
  • On average, people spent just nine minutes on the process. And less than a third tried to access the definitions of key terms like “deductible.” That may raise concerns that they didn’t fully understand details of the plans, and insurers will need to help educate them, said Marc Pierce, president of Stonegate Advisors.
  • “I found it very difficult to compare the different options,” said Elise Loftis, who said she would want to seek advice from an agent. She wanted to know what the plans would cover in hospital costs. Her husband has had his hips replaced, which resulted in an infection and a second hospital stay, and the couple has a 3-year-old son. She chose a Blue Cross plan in the test.
  • The research is shaping Blue Cross’s decisions. The company is initially selling a “tiered” plan that requires consumers to pay more to see certain health-care providers, and next year it will roll out a new design with a smaller network, both approaches that can hold costs down.
  • As in the real exchanges, people had to enter income information to learn what federal subsidy they might get. Then they were shown tiers of plans, ranked as bronze through platinum, with platinum the richest and most expensive. They could also choose from three different insurers, and click to figure out details like deductibles.
  • Forty-one percent of the consumers said they would sacrifice a broad choice of doctors and hospitals in order to save money, even if their own doctor might not be in the plan’s network. Overall, Blue Cross plans were chosen by nearly 60%.
  • The insurer also isn’t offering any platinum plans to consumers, partly because the simulation showed they tended to draw people with significant health needs, a particular concern if it’s the only competitor with a platinum product.

A new, broad Blue Cross marketing campaign boasts of features it hopes will be inviting to consumers, like doctor ratings. Another ad focuses on the idea that consumers can get a refund the following year if they don’t use enough services to get through their deductibles—a design that tends to reward healthier people as well as encourage people to stick with Blue Cross.

*Modified from a WSJ.com article

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Delay in Obamacare – what you need to know

The Obamacare employer mandate has been delayed by a year to 2015, meaning that many businesses can push back providing worker health insurance a bit longer. That changed on Tuesday. In a blog post, the U.S. Treasury Department explained that the government needs time to simplify reporting requirements, and businesses need breathing room to adapt to the changes.

Here’s what businesses and workers need to know.

Who’s affected?

A relatively small share of the country’s businesses fall under Obamacare’s employer rules, and most of those that do already provide insurance. That might sound surprising, because the biggest Obamacare myth spouted by opponents is that it will crush small business. The vast majority of the nation’s businesses, 97% of them, are too small to be affected.

What’s more, most larger employers already provide insurance anyway. Of the nation’s 6.5 million workplaces, only about 70,000 — a little more than 1% — must actually start providing insurance.

Then why does this matter?

The mandate affects most of the nation’s workers. According to the latest Census data, close to 80 million people work at firms that must provide insurance. Though most of them are offered insurance, that still leaves millions who will have to wait another year.

Has the mandate already affected businesses?

It has impacted those businesses that intend to dodge Obamacare by cutting worker hours. The employer mandate kicks in at 50 full-timers, and the law counts anyone who works at least 30 hours a week as full-time.

  • That’s given rise to the “29ers” phenomenon, in which business owners reduce workers’ hours from full-time to 29 hours per week. This has been especially prevalent in the franchising and restaurant industries, where shift hours are frequently swapped.

There’s no telling whether the mandate has already impacted hiring, though. Mark Zandi, chief economist at Moody’s Analytics, said hiring data has yet to show significant changes as a result of Obamacare.

What about the rest of Obamacare?

The Treasury said the latest change doesn’t affect the individual mandate, which requires that most taxpayers buy insurance or pay a government fine. In similar fashion, Treasury said the timeline hasn’t changed for the implementation of individual and small business exchanges — separate marketplaces where people and business owners can shop for insurance at the state level.

But there are doubts.

As originally planned, only those who don’t receive affordable coverage at work can receive federal subsidies while shopping for insurance on the individual exchanges. But now that employers don’t have to abide by Obamacare reporting requirements, which means the government will have no way to verify whether someone is incorrectly getting subsidies.

*Modified from a CNNMoney.com article

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For Fatburger and others, Obamacare delay came too late

Delaying the Obamacare employer mandate has simply put off rules business had already started adjusting to. Under the Affordable Care Act, companies with 50-plus full-time employees must start offering them health insurance or face stiff penalties. The employer mandate had been set to kick in January 2014, but was pushed back a year.

  • Many companies at the International Franchise Expo in New York City last month acknowledged they’ve been adopting that slash-and-share method, cutting hours and splitting workers.
  • The employer mandate remains unpopular with most small business owners. Although it applies to only 3% of the nation’s 5.7 million employers, the vast majority of whom already provide insurance, the rule is seen as burdensome and confusing.
  • Because a 30-hour work week counts as full-time under Obamacare, Fatburger fast-food restaurants had started cutting worker hours below that threshold, CEO Andy Wiederhorn said. Some Fatburger owners even began “job sharing” with other businesses, teaming up to share a higher number of employees all working fewer hours. Someone could work 25 hours at one Fatburger, 25 at another one with a different franchise owner, and still not be a full-time worker under Obamacare rules.

For them, the White House decision to delay implementation doesn’t change much: Small business owners who undo those changes will simply have to redo them next year.

“All it’s doing is causing confusion, anxiety and the workers are paying the price,” Wiederhorn said. “Now, the mandate’s a moving target. It’s very, very challenging.” At Wiederhorn’s second company, Buffalo’s Cafe chicken wing restaurants, he had already given up $30,000 as a result of the employer mandate.

  • One owner of several Buffalo’s Cafe franchises in Georgia planned to close one of his restaurants to get below the 50-employee mark. In response, Wiederhorn reduced the royalty fee his corporation charges franchisees.

Wiederhorn could have waited a year before making the move. “I’m definitely getting the short end of the stick,” he said. “We gave them the concession to save the jobs. And now the law’s been delayed. We feel like we have whiplash here.”

  • Mike Johnson is another Buffalo’s Cafe franchisee who owns four restaurants near Atlanta, Ga. He has no plans to reduce workers’ hours to avoid the mandate. Those covered under his insurance plan will jump from 12 employees to perhaps 70.
  • Even if some of them turn down the offer, he projects his yearly health insurance premiums will go from $60,000 to more than $200,000. That would cut his profits in half, he said.

“I’ve been worried nearly sick about it,” Johnson said. “This gives me another year to look at all the options, and lets the politicians talk about what the best course of action would be.”

Johnson hopes that includes a repeal of the employer mandate. He argues that health care reform will be sufficient enough with the other provisions.

“The employer mandate never made any sense to anybody, especially to struggling small businesses,” he said

*Modified from a CNNMoney.com article

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Obamacare Delay That Boosts Business Concerns Workers

While businesses hailed President Barack Obama’s decision to delay penalizing companies that fail to offer benefits under the health law, workers and states may struggle with the uncertain aftermath.

  • In postponing the mandate for a year, the president has lessened the need for employers to provide coverage or improve on skimpy benefits, and opened questions about who may be eligible for U.S. subsidies being offered in the online insurance exchanges now being created under the law.

For employers, “this is relieving, temporarily, a burden,” said Joseph Antos, a health economist at the nonprofit American Enterprise Institute in Washington. “The usual question is, well, who is harmed?”

The administration, in a blog post July 2, said it would release guidelines next week that it hoped would clarify enforcement of the Affordable Care Act rule going forward.

The delay was welcomed by economists, who saw uncertainty over the law as a drag on hiring.

“I see this as a reason to take a pretty big sigh of relief for the near-term economic outlook,” said Stephen Stanley, chief economist at Stamford, Connecticut-based Pierpont Securities LLC. “There were a lot of firms that probably were just not doing anything because they had no clarity on what labor costs were going to be next year.”

30 Hours

Under the provision, companies with 50 or more workers face a fine of as much as $3,000 per employee if they don’t offer affordable insurance. The rule covers those working 30 hours a week or more. Valerie Jarrett, a senior Obama adviser, said in a blog post announcing the move that the administration decided on the delay so officials could simplify reporting requirements.

While surveys suggested the mandate wasn’t deterring most businesses, the administration has faced a steady stream of reports about employers limiting hours or holding off on hiring. Employees at Darden Restaurants Inc (DRI)., owner of the Olive Garden and Red Lobster chains, who work fewer than 30 hours a week will be considered part time and won’t be offered insurance, Bob McAdam, the company’s senior vice president of government and community affairs, said in a phone interview. The company expects about 75 percent of its workforce to remain part time, he said.

The one-year postponement “could help boost payroll growth,” Maury Harris, a New York-based economist at UBS, said in a research note to clients. “For those employers on the cusp of the 50-employee threshold, this delay may prompt them to hire as they may be unwilling to continue to postpone hiring” to avoid offering benefits.

Payroll Growth

U.S. payrolls have been growing this year, with the economy adding 175,000 jobs in May and 149,000 in April, according to the Labor Department. The unemployment rate climbed 1/10th of a percentage point last month to 7.6 percent as more Americans entered the workforce. The government will report job growth for June on July 5.

Still, the delay may do little for hiring, said Amanda Austin, director of federal policy for the National Federation of Independent Business, a Washington trade group that calls itself “the voice of small business” in the U.S.

“Businesses like to plan for more than a year out,” she said in a telephone interview. “If they were looking at a plan to put in place for this, they will probably continue on with it. Just one year is not going to provide substantial relief.”

The downside could come for Americans lacking insurance coverage, said Rich Umbdenstock, president of the Chicago-based American Hospitals Association.

‘Shared Responsibility’

“The goal of the ACA was to extend coverage to the uninsured, which required a shared responsibility from all stakeholders,” he said in a statement. “We are concerned that the delay further erodes the coverage that was envisioned.”

Without the penalties, the U.S. government may lose as much as $10 billion in revenue next year, the amount expected to be generated according to congressional estimates.

The White House suggested the impact of the decision would be limited. Ninety-eight percent of workers in firms with 50 or more employees worked for a company that offered health coverage to at least some of its employees in 2012, according to the Kaiser Family Foundation’s Employer Health Benefits Survey.

In March, meanwhile, a survey of large employers found 84 percent said they were unlikely to cut part-timers’ hours to avoid the mandate, according to Towers Watson & Co (TW)., the New York-based benefits adviser that conducted the research. Small employers were a different matter: An April poll by Gallup found 41 percent said they had backed off on hiring due to the law and 18 percent said they would have to cut workers’ hours.

Existing Requirements

Other requirements for businesses will remain in effect, said J.D. Piro, leader of the health-law group at benefits consultant Aon Hewitt, in a telephone interview.

Companies still must offer insurance to their workers’ children until age 26, and they must pay a minimum of 60 percent of medical bills and provide preventive health services, including birth control, without cost-sharing by employees, Piro said. Those provisions carry $100 daily fines per violation.

The delay “only applies to the employer mandate,” Piro said. “It doesn’t apply to any other part of the act.”

The individual mandate, a linchpin of the law that requires most Americans to carry health insurance, also remains in effect. So, too, will the online insurance exchanges, which are expected to sell subsidized health plans to some 7 million people next year.

More Difficult

While the Obama administration said the exchanges were on track to open for enrollment at the law’s Oct. 1 deadline, the delay promises to complicate their operations, said Kevin Counihan, executive director of the state of Connecticut’s exchange, in a telephone interview.

Government subsidies for uninsured people who buy coverage through the exchanges are supposed to be available only for those not offered affordable health insurance on the job. The markets will now have to figure out how to verify eligibility without employers reporting their benefits, Counihan said.

The government could demand subsidies back from consumers when they file tax returns in 2015, although that might produce a political “horror show,” he said.

Counihan said he was waiting to see what the administration proposes in follow-up regulations.

“There’s going to clearly be confusion about this,” he said. “There’s going to be a percentage of the population that also thinks that the whole thing has been delayed by a year.”

*Modified from an Insurancebroadcasting.com article

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ObamaCare employer mandate delayed until after 2014 midterms

The ObamaCare employer mandate requiring businesses to provide their workers with health insurance will be delayed by a year, the administration said Tuesday in a stunning announcement.

  • Delaying the requirement until 2015 is an enormous victory for businesses that had lobbied against the healthcare law. It also means that one of healthcare reform’s central requirements will be implemented after the 2014 midterm elections, when the GOP is likely to use the Affordable Care Act as a vehicle to attack vulnerable Democrats.
  • Many employers had threatened to cut employees’ hours to avoid the new requirements. Employers had also complained about the mandate’s reporting provision. Rules on the requirement came out this year, leaving little time for businesses to respond and prepare.

In a White House blog post, senior adviser Valerie Jarrett wrote that the administration believed it needed to give employers “more time to comply with the new rules.”

“This allows employers the time to test the new reporting systems and make any necessary adaptations to their health benefits while staying the course toward making health coverage more affordable and accessible for their workers,” Jarrett wrote Tuesday evening.

Jarrett also wrote that the delay would help in “cutting red tape and simplifying the reporting process.”

“We have heard the concern that the reporting called for under the law about each worker’s access to and enrollment in health insurance requires new data collection systems and coordination,” Jarrett said. “So we plan to re-vamp and simplify the reporting process.”

The Treasury Department’s announcement does not affect the individual mandate, which requires most taxpayers to either purchase insurance or pay a penalty, and administration officials said on Tuesday that other aspects of the law wouldn’t be delayed.

The law’s critics quickly framed that as a double standard, accusing the administration of acknowledging the law’s complexity for businesses without offering a similar break to the individual workers who still have to buy insurance. The employer mandate affected businesses with more than 50 workers.

“That the Obama administration is putting off this job-killing requirement on employers, but not individuals and families, shows how deeply flawed the president’s signature domestic policy achievement is,” said Sen. Orrin Hatch (Utah), the ranking Republican on the Senate Finance Committee.

“While a delay of this mandate is welcome news since it shows the challenges the employers are facing complying with it, a delay — conveniently past the 2014 election — only adds to the uncertainty these job creators face because of ObamaCare,” Hatch said.

Other Republicans seized on the news, arguing that the delays suggested the law was a “train wreck” and that Democratic candidates in 2014 would have difficulty explaining the delay.

Speaker John Boehner (R-Ohio) and House Majority Leader Eric Cantor (R-Va.) renewed their calls for repealing the law in full.

“This further confirms that even the proponents of ObamaCare know it will hurt jobs, decrease economic growth and make it harder for families to have access to quality and affordable health care,” Cantor said in statement.

“Rather than continuing to delay the predictable pain until another Election Day has passed, we should scrap this entire law and instead implement patient-centered reforms before any more damage is done,” he said.

Some Democrats had openly fretted about the law’s implementation.

While GOP leaders were quick to react, hammering the delay as evidence that the law is unworkable, Democratic leaders were quieter Tuesday evening. One exception was Democratic National Committee Chairwoman Debbie Wasserman Schultz (Fla.), who tweeted that the decision shows Obama is “in it for long haul to fully implement” the healthcare law.

Adam Jentleson, a spokesman for Senate Majority Leader Harry Reid (D-Nev.) said the administration was showing “a willingness to be flexible.”

“It is better to do this right than fast,” said Jentleson in a statement.

Sen. Max Baucus (D-Mont.), one of the primary architects of the healthcare law, warned in April that small businesses were struggling to come to grips with their new responsibilities.

“Small businesses have no idea what to do, what to expect,” Baucus told Health and Human Services Secretary Kathleen Sebelius at a hearing.

“I just see a huge train wreck coming down,” Baucus said.

The U.S. Chamber of Commerce praised the delay.

“The administration has finally recognized the obvious: Employers need more time and clarification of the rules of the road before implementing the employer mandate,” said Randy Johnson, the Chamber’s senior vice president for labor, immigration, and employee benefits.

“The Chamber has testified numerous times about the problems with the mandate, and we applaud the administration’s step to delay this provision. We will continue to work to alleviate this and other problems with ObamaCare.”

“I hope that this means that employers who have been cutting employees to part-time will now call them back to full-time employment, but regret that the administration is delaying the implementation of an important provision of the ACA,” said Timothy Jost, a law professor at Washington and Lee University and a strong supporter of the healthcare law.

The change will likely mean that more people buy individual coverage through the law’s new insurance exchanges, which are supposed to be open for enrollment by Oct. 1.

If fewer employees have access to coverage through work, at least some are likely to turn to the exchanges for coverage and the tax credit that helps cover the cost.

Hatch said he hoped that was not the administration’s goal, stating it could be a “back door attempt at getting more Americans into the exchanges, which have been plagued by problems.”

More people on the exchanges would also mean greater federal spending on the tax subsidies, increasing the law’s total cost.

Sabrina Corlette, a health policy expert at Georgetown University, said the move could be a boon to consumers because plans on the exchanges will be stronger than those offered by many employers. She worried, however, that the employer mandate could be deferred again down the line.

“Anyone that’s been around politics long enough knows to be a little bit concerned,” Corlette said. “If a one-year delay is OK, how about a two-year delay? How about a three-year delay?”

The political effects of the delay could be more severe than the effect on the law’s expansion of healthcare coverage. One vulnerable Democrat, Sen. Mark Begich (Alaska), hailed the decision.

“I’m pleased the administration is listening to me and the many businesses that are concerned about the complexity of the new requirements,” said Begich, who is facing reelection in 2014.

In its most recent estimates before the delay was announced, the Congressional Budget Office said the number of people with employer-based coverage was not expected to change next year.

The penalty for employers that failed to offer coverage was also not expected to bring in any money next year, according to the CBO’s latest estimates.

The delay gives employers a free year to dump their workers into the law’s insurance exchanges, former Congressional Budget Office director Douglas Holtz-Eakin said.

“Essentially for calendar 2014, the act of dropping coverage and dumping employees into the exchanges is on sale,” he said. “Drop and dump, but no penalty.”

*Modified from a Hill.com article

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Think NSA Spying Is Bad? Here Comes ObamaCare Hub

The Health and Human Services Department earlier this year exposed just how vast the government’s data collection efforts will be on millions of Americans as a result of ObamaCare.

  • Sen. Max Baucus, D-Mont., asked HHS to provide “a complete list of agencies that will interact with the Federal Data Services Hub.” The Hub is a central feature of ObamaCare, since it will be used by the new insurance exchanges to determine eligibility for benefits, exemptions from the federal mandate, and how much to grant in federal insurance subsidies.
  • In response, the HHS said the ObamaCare data hub will “interact” with seven other federal agencies: Social Security Administration, the IRS, the Department of Homeland Security, the Veterans Administration, Office of Personnel Management, the Department of Defense and — believe it or not — the Peace Corps. Plus the Hub will plug into state Medicaid databases.
  • And what sort of data will be “routed through” the Hub? Social Security numbers, income, family size, citizenship and immigration status, incarceration status, and enrollment status in other health plans, according to the HHS.
  • That filing describes a new “system of records” that will store names, birth dates, Social Security numbers, taxpayer status, gender, ethnicity, email addresses, telephone numbers on the millions of people expected to apply for coverage at the ObamaCare exchanges, as well as “tax return information from the IRS, income information from the Social Security Administration, and financial information from other third-party sources.”
  • They will also store data from businesses buying coverage through an exchange, including a “list of qualified employees and their tax ID numbers,” and keep it all on file for 10 years.
  • In addition, the filing says the federal government can disclose this information “without the consent of the individual” to a wide range of people, including “agency contractors, consultants, or grantees” who “need to have access to the records” to help run ObamaCare, as well as law enforcement officials to “investigate potential fraud.”

“The federal government is planning to quietly enact what could be the largest consolidation of personal data in the history of the republic,” noted Stephen Parente, a University of Minnesota finance professor.

Not to worry, says the Obama administration. “The hub will not store consumer information, but will securely transmit data between state and federal systems to verify consumer application information,” it claimed in an online fact sheet .

Rep. Diane Black, R-Tenn., complained that just months before ObamaCare officially starts, the Obama administration still hasn’t answered “even the most basic questions about the Data Hub,” such as who will have access to what information, or what training and clearances will be required.

Beyond these concerns is the government’s rather sorry record in protecting confidential information. Late last year, for example, a hacker was able to gain access to a South Carolina database that contained Social Security numbers and bank account data on 3.6 million people.

A Government Accountability Office report found that weaknesses in IRS security systems “continue to jeopardize the confidentiality, integrity, and availability of the financial and sensitive taxpayer information.”

A separate inspector general audit found that the IRS inadvertently disclosed information on thousands of taxpayers between 2009 and 2010. In 2011, the Social Security Administration accidentally released names, birth dates and Social Security numbers of tens of thousands of Americans.

If these government agencies can’t protect data kept on their own servers, how much more vulnerable will these databases be when they’re constantly getting tapped by the ObamaCare Data Hub?

In any case, creating even richer and more comprehensive databases on Americans will create a powerful incentive to abuse them among those looking to score political points by revealing private information or criminals who want to steal identities.

A recent CNN poll found that 62% of Americans say “government is so large and powerful that it threatens the rights and freedoms of ordinary Americans.”

*Modified from an IBD.com article

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Will Obamacare Hurt Jobs? It’s Already Happening, Poll Finds

Small business owners’ fear of the effect of the new health-care reform law on their bottom line is prompting many to hold off on hiring and even to shed jobs in some cases, a recent poll found.

“We were startled because we know that employers were concerned about the Affordable Care Act and the effects it would have on their business, but we didn’t realize the extent they were concerned, or that the businesses were being proactive to make sure the effects of the ACA actually were minimized,” said attorney Steven Friedman of Littler Mendelson. His firm, which specializes in employment law, commissioned the Gallup poll.

  • “If the small businesses’ fears are reasonable, then it could mean that the small business sector grows slower than what economic conditions otherwise would indicate. And small businesses have been a growth engine in the economy,” Friedman told CNBC.
  • Forty-one percent of the businesses surveyed have frozen hiring because of the health-care law known as Obamacare. And almost one-fifth—19 percent— answered “yes” when asked if they had “reduced the number of employees you have in your business as a specific result of the Affordable Care Act.
  • The poll was taken by 603 owners whose businesses have under $20 million in annual sales. Another 38 percent of the small business owners said they “have pulled back on their plans to grow their business” because of Obamacare.
  • The prevalent pessimism tracks other answers in the poll, which showed that 55 percent of small business owners believe that the ACA will lead to higher health-care costs. By contrast, about 5 percent said the law would lead to lower costs.
  • Just 9 percent of the small employers surveyed agreed that Obamacare would be “good for your business,” while another 39 percent saw “no impact.”
  • In addition to restricting hiring or cutting jobs, small companies are considering other ways to mitigate the expected financial fallout. Twenty-four percent are weighing whether to drop insurance coverage, while 18 percent have “reduced the hours of employees to part-time” in anticipation of the ACA’s effects, the poll found.

Those are “some pretty startling answers,” Friedman said.

“To think that [nearly] 20 percent of small businesses have already reduced the numbers they have in their business because they’re concerned about the medical coverage is significant, and a bit troubling,” Friedman said.

Friedman said that Littler Mendelson, which recently created a health-care reform consulting group, had heard small business clients talk about their fear that the rules and other effects of the ACA will lead to higher costs. The poll supported that anecdotal data with the finding that 48 percent of owners think the law will be bad for their bottom line.

And more than half—52 percent—said they expected a reduction in the quality of health care under Obamacare, while just 13 percent expected an improvement.

“I can’t say that the fears appear overstated, because the potential for big problems seems rather large,” Friedman said about law’s implementation.

“We don’t know until 2014 and beyond what the impact of the ACA will be on businesses,” he said. “There is tremendous fear that the premiums will be much higher, for small businesses especially. At this point we can’t look a client straight in the eye and say, ‘Don’t worry about it. Everything will be fine.’ ”

Gallup Chief Economic Dennis Jacobe said small business owners’ answers in the poll “is consistent with owners’ tendency to be more Republican than Democratic, higher-income, more against big government, more conservative and less optimistic than Americans overall.”

*Modified from a CNBC.com article

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What to Expect of the Small-Business Insurance Exchanges

Looking to buy a small group plan from your state’s new health-insurance exchange? There’s a risk it won’t be ready to open on time in October.

  • Eleven percent of 783 firms with less than $20 million in annual revenue said that their biggest concern regarding the health-care law is how the insurance exchanges will operate, according to an April survey by The Wall Street Journal and Vistage International Inc., a San Diego-based executive-mentoring group. That compares with 33% who said the cost of health care is their top concern.

If you own a small business and are looking to purchase a small-group plan from your state’s exchange, here’s what you need to know:

Is my small business eligible to buy insurance from an exchange?

  • The exchanges are limited to only businesses with 100 or fewer full-time-equivalent employees. Full-time equivalent is the number of employees on full-time schedules plus the number of employees on part-time schedules, converted to a full-time basis.

How would an exchange benefit my business?

The small-business exchanges are expected to make it easier for small employers to manage their health-benefits programs. An employer could make a single payment to an exchange, which would disburse the money to the various insurance providers covering its staff, among other benefits.

Also, small group plans purchased through an exchange could be less expensive than what’s available in the private marketplace. This is because the exchanges are expected to attract a large pool of participants, which theoretically would create more competition among insurers, thus resulting in lower insurance premiums.

Husband-and-wife business owners Chris and Maria Guertin of Minneapolis are among those hoping to find a small-group insurance plan within their budget through their state’s exchange. They say they currently can’t afford one to cover themselves, their one full-time employee and any recruits they hire in the future for Sport Resource Group Inc., a retail and wholesale company they started in 2006. But they would like to be able to offer health insurance as an employee benefit to attract and retain top talent in order to grow the business. “A group plan right now is too much,” says Mr. Guertin.

Who’s running the exchanges?

Seventeen states are running their own small business exchanges, with the federal Centers for Medicare and Medicaid Services carrying out the task on behalf of the remaining 33 states.

What kind of plans will the exchanges offer?

The exchanges will offer insurance plans from private insurance companies. For 2014, employers in states where the federal government is running the exchange will be able to select just one plan to offer to workers. Which carriers will be participating and how many will vary by state.

When will I be able to start using my state’s exchange?

  • Though enrollment is slated to begin in October of this year, with plans to take effect in January 2014, the GAO report suggests they may not open in time. The 17 states running their own exchanges were late on an average of 44% of key activities that were originally scheduled to be completed by the end of March, it said.

There have been other setbacks as well. The federal government said in April that contrary to initial plans, it wouldn’t allow workers in the first year to choose between a range of insurance options offered through employers. For the first year, companies will select one plan to offer to workers.

Can I get a tax credit?

If you have fewer than 25 full-time equivalent employees, you may qualify for a tax credit of up to 35% of your premium costs this year and up to 50% in 2014.

Do I even need to buy a small-group plan?

Once your firm reaches 50 full-time equivalent employees, a penalty will kick in if you fail to provide coverage for employees who average 30 or more hours a week in a given month, starting in January. The penalty is $2,000 for each full-time employee in excess of 30 full-time employees. There are no penalties if part-time employees are not offered coverage. The government will rely on data about the composition of employers’ workforces this year in order to determine whether a firm will be liable.

Also, if an employer with 50 or more full-time equivalent employees does offer coverage, but the insurance doesn’t meet the law’s minimum requirements, there is a penalty of $3,000 for each worker who gets a federal subsidy through state insurance exchanges.

*Modified from a WSJ.com article

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