Mike HornickChristopher Condeluci, an attorney with Venable LLP, addresses United Fresh 2013 attendees on healthcare law as Will Steele, left, president and chief executive officer of Frontera Produce, looks on.SAN DIEGO — The federal health care overhaul will make a bigger impact through insurance premium subsidies that change management and labor behavior than it will through its provisions for universal access, a former Senate finance committee advisor told United Fresh 2013 attendees.
Christopher Condeluci, an attorney with Baltimore-based Venable LLP, was tax counsel to Republicans on that committee for nine months in 2009. Much of the Affordable Care Act — or “Obamacare” — was drafted then by the committee.
As employees and employers make and revise their calculations on premium subsidies and tax penalties, the results could stand conventional wisdom on its head, Condeluci told a May 16 session of the United Fresh Grower-Shipper Board. For example, there could be scenarios where offering coverage hurts rather than helps retention of employees.
“Your employee may come to you and say, ‘Because you’re offering me this plan, I can’t go to the exchange and get the subsidy,’” the attorney said. “He might say, ‘Drop coverage or I’m just going to quit and go somewhere else where they don’t offer it.’”
“As an employer I might say ‘Sure,’ because I can save dollars and I know people are getting covered by quality insurance.”
“Subsidies are the most important part of this law,” he said. “No pre-existing condition, accessibility and the closing of the doughnut hole — those are all helpful. But they are not going to affect behavior to the degree that premium subsidies will.”
It’s been too little reported, Condeluci said, that individuals offered a qualifying employer health plan won’t be eligible for a subsidy when insurance exchanges open in October or January. They’ll be unhappy they’re not getting it, and maybe for good reason. It all depends on their income, household situation and what coverage their employer offers.
Less reasonable behavior is possible too. Employees could misrepresent employers’ plans to the exchanges in order to claim the subsidy. Condeluci forecasts “administrative action back and forth” between exchanges and employers on such issues.
There are two ways for companies with 50 or more full-time employees — which represent the majority of United Fresh attendees — to run afoul of the law’s employer mandate and face penalties: