Share “How much will federal health law cost...”

How much will federal health law cost employers?

Published on NewsOK Modified: January 14, 2013 at 5:22 pm •  Published: January 14, 2013

FORT LAUDERDALE, Fla. (AP) — How much the new federal health care law will cost state businesses was the prevailing question Monday as Florida lawmakers met to discuss the law. The answers were all over the map.

"I would hesitate to say there's a universal answer that applies to everyone but you know, I think for the majority of employers it's going to be pretty close to status quo to where they're at currently," said Justin Kindy, a senior vice president with Aon Hewitt.

Jon Urbanek, a senior vice president with Blue Cross and Blue Shield of Florida, warned that because of new requirements in the federal law, many small business employers will have to increase the benefits they currently offer in their packages, which means spending more money.

"Most will have to offer a lot richer benefits than they offer today," he told a Senate health care committee.

His company still doesn't have a breakdown of a dollar amount the law will have on a business with 25 employees, 100 employees and so on because he said they are still waiting for federal health officials to clarify many guidelines.

That leaves a lot small business in limbo.

Tallahassee small business owner Kim Williams said he was "thoroughly confused" and still had tremendous uncertainty about how the new health care law would impact his company of about 75 employees. His company has picked up 100 percent of employees' health care costs every year except for this past year.

"A lot of small businesses out there are seriously considering that they're going to have to go out of business because of the convoluted way this all plays out," said Williams, president of Marpan Supply Company.

Urbanek said about 50 percent of the small businesses his company talked with initially indicated they would opt out and pay a penalty for not providing coverage. But as Blue Cross Blue Shield of Florida is working with employers, that number has fallen below 20 percent, he said.

The health plans that employers offer must meet two criteria.

It must have an actuarial value of 60 percent and employees can't contribute more than 9.5 percent of their wages. If the plan doesn't meet that requirement and an employee goes to exchange and gets a subsidy, the employer will get hit with a $3,000 penalty, said Urbanek.

He also ticked off a list of likely additional costs that employers will face, extra administrative costs, counting seasonal workers as full time equivalents and increasing the age for which dependents can be covered.

Democratic Sen. Darren Soto asked why the analysis did not include potential savings that could come from the law.

"So we're talking about the costs of compliance but we don't have any information on what money would be saved by bringing all these folks into an insurance system so our premiums wouldn't go to subsidize their care which is currently uninsured," he said.

Committee Chair Sen. Joe Negron said the panel would consider those cost savings in future discussions.

A House committee also met Monday to discuss health care but did not make any decisions and was still in the information gathering stage.

Florida lawmakers are facing two major decisions regarding the federal health overhaul. They must decide whether to expand Medicaid rolls to offer health coverage to more low-income families and whether to allow the feds to run an online health exchange or whether to partner with them.

Florida spends about $21 billion a year to cover nearly 3 million of the state's poorest residents, about half of whom are children.

The Obama administration wants to offer coverage to more residents under Medicaid and include those making up to 133 percent of the poverty level — $29,326 for a family of four in Florida. The changes would also require adding those who are below the poverty level but not eligible for Medicaid, such as childless adults.

Republican Gov. Rick Scott has repeatedly expressed concerns about the financial burden the expansion would bring to Florida taxpayers. Last week, he estimated it would cost $26 billion over a decade, but the state health agency later revised that figure to $3 billion after pressure from lawmakers who accused Scott of trying to play politics with the numbers.


  1. 1
    Ex-Oklahoma State signee Devon Thomas arrested in Tulsa
  2. 2
    10 Great Stevie Ray Vaughan Tributes
  3. 3
    Happy Birthday, 'Highway 61': Dylan's Weirdest, Funniest Album Turns 50
  4. 4
    NBA's Derrick Rose accused of drugging, raping woman
  5. 5
    Google Chrome will block auto-playing Flash ads from September 1
+ show more


× Trending health Article