Whether you approve or disapprove of the Healthcare Reform Bill that was passed in 2010, you have to admit that it is bringing out the best in some Americans. Good old American ingenuity is coming to the forefront of some American’s thinking as they try to devise ways to circumvent the law.
The latest attempt to avoid paying the fine imposed on employers by the Patient Protection and Affordable Care Act. (PPACA) is by small business owners with more than 25 employees. The PPACA mandates that employers with more than 25 employees to provide healthcare insurance for their employees, while employers with 25 or fewer employees are exempt from this requirement. Some small business owners are proposing that they split their company into smaller, separate companies with less than 25 employees each, thus avoiding the requirement to provide healthcare insurance for their employees.
Not so fast says the Obama administration. They point to an IRS ruling which states that if two or more companies are held beneficially by the same ownership, then the separate companies can be treated as one entity for tax purposes. The Obama administration has claimed that this ruling should apply to small businesses who try to avoid the employer provided healthcare insurance mandate by splitting up companies into smaller divisions. They claim that if several small businesses are owned by the same individuals, the total number of employees working for all the businesses should be considered the total number of employees.
This difference of opinion will set-up a court battle, and frankly, I wouldn’t bet against the government on this one. A better solution to the problem of keeping the total number of employees under the 25 employee threshold would be for a business of 90 employees to be split-up between 4 or more owners, but with each owning a ‘baby’ business individually, rather each of the 4 owners owning 25% of 4 different ‘baby’ businesses. I realize that will create a whole new set of problems, such as equitable division of the parent company, but I have faith in Americans’ ingenuity.
Another area that is causing a great deal of concern within the healthcare community is the formation of Accountable Care Organizations (ACO). ACO’s are a cornerstone of the anticipated savings that are promised by the PPACA. Doctors and hospitals are supposed to join forces and agree to treat a certain patient population for a minimum of 5 years for a fixed amount. The problem with ACO’s is that several states had passed laws banning collusion between doctors and hospitals which restricts doctors from owning and operating testing facilities and rehabilitation clinics to which they refer. Texas had to pass a new law allowing hospitals and doctors to form partnerships as required by ACO’s. Other states have to revise their existing laws to allow ACO’s to operate within the state.
Another problem that I see with the ACO’s is that they appear to be no different than the HMO’s of the 80′s and 90′s. Many people have soured on the idea of HMO’s because they, too, treated people for a set amount each year, and tried to turn a profit by decreasing service to patients and reducing salaries paid to doctors and staff. I still feel that the idea of ACO’s is to condition Americans to the idea of less treatment and less personalized treat from their doctor so that when the Federal government ends up running the healthcare system, there will not be a huge uproar as services are cut or taxes are raised to provide ‘free’ healthcare for everyone.
So, the long and the short of the result of the PPACA is that there is something for everyone to hate about it. Which, as I recall, was what some politician said indicates that that is the result of a good compromise. That’s a sad comment on the mindset of our politicians, today.
It was a week that was dominated with world news ranging from the increasing unrest in the Middle East to the continued concern over the possible radiation risks as a result of the earthquake and Tsunami in Japan
Healthcare reform has not been high on the priority list of important topics. This is the time that a very close eye needs to be kept on the politicians, who like to try to pass unpopular laws when no one is looking. The ACA is still being implemented by the Obama administration, though it has been declared unconstitutional by 2 Federal judges.
According to the latest Kaiser poll, taken the second week of March, people remain divided in their feelings about the law, with 42% viewing it favorably and 46% viewing it unfavorably, and 53% say they are confused. The 53% who say they’re confused is only slightly less than the 55% who reported the same last April, shortly after the law was passed. Not surprisingly, Democrats generally have a positive view, while Republicans are strongly opposed. Independents are split, though they’re leaning towards a negative view (49%) rather than a positive one (37%).
In short, we are in a hurry up and wait mode, while the constitutionality of the Healthcare Reform Bill winds its way through the court system.
