Employers Might Look to Temporary Staffing To Avoid ACA Mandate
Some businesses might begin hiring more workers through temporary-staffing agencies to avoid providing health insurance under the Affordable Care Act, which could undermine the law's goal of expanding coverage, the Washington Post reports (Hancock, Washington Post, 3/25).
Under the ACA, businesses with at least 50 workers beginning in 2014 must pay a penalty of $2,000 per employee if they do not provide affordable coverage to their employees. Employers will not be required to pay for the first 30 workers who are included in the penalty calculation (California Healthline, 3/1).
However, the law requires that businesses offer coverage only to those employees who work more than 30 hours per week. In addition, an IRS rule allows businesses to avoid providing health coverage to "variable-hour" workers if it is unclear whether such employees will be full time
Â Employers have a year to determine whether the workers qualify for health benefits -- but many temporary staffers do not remain with the same company for a full year. As a result, businesses could have an incentive to hire more temporary, part-time employees, according to the Post.
Susan Houseman, an economist with the Upjohn Institute for Employment Research, said the rules "were written in a very favorable way for the temporary-help industry."
Temporary staffers still can purchase coverage through the ACA's insurance exchanges and many likely will qualify for subsidies to help them purchase coverage. In addition, some will qualify for Medicaid, according to the Post (Washington Post, 3/25).
ACA Leads to 111M Hours of Paperwork, $30B in Costs
"Beyond the political scapegoats in the health care debate, large insurance companies, individuals also face strong regulatory headwinds," according to the report, which adds, "Many of the $30 billion in costs will eventually affect individuals, in some form."
The report notes that the law's "real impact" will come from how the costs and paperwork affect consumers, the health care industry and small businesses (Baker, "Healthwatch," The Hill, 3/25).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.