A Small Delay On PPACA
The PPACA mandate has been delayed, but does it really matter? I believe it does matter and it reflects how the Obama administration sees the ripple effects on businesses.
In fact, many feel it may demonstrate the administration has finally listened to those businesses who have been clamoring about the high costs they will have to absorb once the PPACA is fully enacted. But I believe it may have more to do with what needs to happen behind the scenes on a government level to support the law. The government is still woefully unprepared to meet all of the mandates and requirements it has imposed upon itself.
The law has already significantly affected the mindset of many “small to mid size” businesses and I find that many still strive to understand all the administrative intricacies to compliance. Thus, the news came as no surprise given the enforcement of this law is no small undertaking. News of the delayed mandate can be perceived as a disingenuous move. But I believe this delay of the inevitable may delay the attention that many need to really take a closer look. This time allows time for companies to strategize how they will position their workforce to maximize productivity and comply with their legal obligations under the law.
Truly small businesses (those under 50 employees or the FTE equivalent) will likely gain advantageous benefit options for their workforce via the options that can in fact help them attract talent. The private exchanges are sure to broaden the options currently available for the segment of employers as well as individuals. Mid size employers (50 or more employees) can embrace the wellness initiatives to financially incentivize their benefits utilization to the tune of up to 30% and up to 50% specifically for nicotine or cessation programs in coming years. That is no small percentage and with outcome vs. participation based wellness initiatives, employers and employees can reap rewards. For larger employers, the cadillac tax leaves no business untouched potentially and with a threshold being set on premium, one really must wonder how much control a company truly has on their premium. Makes me even think I need to reread it! Regardless, there are specific industries (e.g. retail, contingent staffing firms, companies with seasonal in fluxes that stretch beyond 120 days) that will need to prepare for significant changes to their benefits platform and in cases where they may have large numbers of people this could require improved time keeping systems, improved policy framework defining classifications and benefit eligibility provisions and in some cases a whole new approach to how a company approaches staffing its workforce.
Businesses should treat this delay from the government as a gift. The extra time should allow them to figure out how they are going to address all of the new rules and perhaps implement systems and/or policy to ensure the impact is managed. This should not be treated as a time to relax, but rather as time to do the necessary homework to ensure employers are not only compliant but able to thrive through it all without slowing down.
