Inequities and intransigence: The fierce need for immigration reform

A Mexican national crossed the border when he was 18 years old, and five years later he married a U.S. citizen. He is now 32 years old and has three children.

Over the years, he has traveled to Mexico to visit family. Under the current law, he could never get a green card, nor is he eligible for the Deferred Action for Childhood Arrivals program.

What needs to happen

Comprehensive immigration reform has consistently garnered bipartisan support. Former President George W. Bush backed a bipartisan Senate bill, but it failed to pass in 2007.

President Barack Obama built on this bipartisan support and promised to make comprehensive immigration reform a priority. In 2013, the Senate passed the Border Security, Economic Opportunity, and Immigration Modernization Act, and it seemed as though reform was finally happening. Unfortunately, in the past year, the House of Representatives has refused to discuss the issue.

Faced with the House’s intransigence, Obama promised he would exercise executive action, which may happen soon now that the November election is over.

For now, we need to focus on the dire need for immigration reform and how it affects our communities and where people work. We need to amend the permanent bar, section 212(a)(9)(C), to allow immigrants who travel between contiguous countries (Mexico and Canada) to apply to adjust their status to lawful permanent residents.

The man mentioned earlier has consistently filed tax returns and has no criminal record. It is a shame he must constantly fear being deported and separated from his family.

Land or water travelers at issue

The case of a 54-year-old Chinese national also demonstrates the need for reform. He came to the U.S. in 1992 in the wake of the Tiananmen Square protests. He traveled by boat for 40 days before reaching California.

He was married in 1998; his wife was a legal permanent resident who received her green card through political asylum because she feared being persecuted in China. In 2003 she became a U.S. citizen. The couple has two children together, who are currently attending Brown University and New York University on full scholarships. He has no criminal record and has been filing tax returns since 1995.

Unfortunately, he could never apply for a green card. In order to obtain a green card under the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, an immigrant must be “admitted, inspected, or paroled” at the border. Immigrants who arrive by air and are released are considered inspected and thus are eligible to eventually adjust status.

Those who arrive by land or water are not considered to have been “admitted, inspected or paroled” and are ineligible to adjust. This is absolutely absurd. Arriving by water, land and air should be considered the same under immigration law.

In the months ahead, I will continue to write about these and other pressing issues. I feel honored and humbled to be working in this field, to be on the ground soldiering with the Department of Homeland Security, promoting our country’s greatness.

Geithner welcomes India’s new drive for reform

WASHINGTON, Tue Oct 9, 2012 – U.S. Treasury Secretary Timothy Geithner welcomed New Delhi’s new-found appetite for economic reform on Tuesday, barely three months after Washington had voiced concern about India’s deteriorating investment climate.

Hailing the latest reforms as “significant,” Geithner told a news conference with Indian Finance Minister P. Chidambaram in New Delhi that the policies offered “a very promising path to improving growth outcomes for the Indian economy.”

India’s economic growth has slowed to its lowest in nearly three years and earlier on Tuesday the International Monetary Fund (IMF) sharply cut its projection for GDP growth to 4.9 percent in 2012, one of the lowest official forecasts so far.

“The recent reforms advanced by Prime Minister (Manmohan) Singh and Minister Chidambaram will help provide a foundation for stronger economic growth, an increase in investment, and more widespread gains in income,” Geithner said.

Regulatory uncertainty and policy gridlock have battered foreign corporate investment towards India over the past year, adding to dramatic slowdown in growth.

How health care reform will impact you and your employees

Paul Baranowski, Director of Account Management, Benefitdecisions, Inc.

Many employers are beginning to cope with the realities of the Patient Protection and Affordable Care Act as its mandates, confirmed as constitutional by the Supreme Court, begin to take effect. Still, many questions exist, as some of the law’s major provisions have yet to apply.

“Complying with the new regulations might be frustrating and confusing for the first few years and employers will have to rely on their trusted advisers and insurance carriers for assistance and guidance,” says Paul Baranowski, Director of Account Management at Benefitdecisions, Inc.

Smart Business spoke with Baranowski about the impending reforms and the effects they will have on your employees, their benefits and your business.

What are the key concerns employers will face regarding health care reform?

The immediate concerns for most employers are the mandates that will go into effect with this next benefits renewal cycle. The primary mandates include women’s health preventive care amendments, uniform summary of benefits and coverage statements, W-2 reporting requirements and a reduction in the maximum amount an employee can put into his or her health flexible savings account (FSA).

Regarding the women’s amendment, the mandates require that plans cover 100 percent of expanded services, including preventive screenings for HPV, sexually transmitted infections, HIV and gestational diabetes. Additionally, counseling for these services will be covered. Finally, commonly used contraceptive methods will be covered, as well. Some services related to these categories have been a part of plans for some time but are now covered at 100 percent. By expanding the definition of covered services, the act will increase costs to insurance carriers in the short term, which will then be passed on to employers as premium increases.

The Uniform Summary of Benefits and Coverage is required for group plans with open enrollment periods after Sept. 23, 2012. This is a new, separate benefit coverage document that attempts to explain coverage in a standardized format. It is intended to make plan comparisons easier and to illustrate what an employee’s costs under the plan will be. However, due to design and content restrictions, employees may get confused and potentially misunderstand what their own expenses will be for their health care services. As a consequence, employers will have to be more thorough, cautious and deliberate in their open enrollment meetings and education to employees. Most employers are fully insured, so their insurance carriers will produce the Uniform Summary document. Employers that are self-funded, however, will be required to assemble these themselves. Some claims administrators will charge fees to produce the summary on behalf of a self-funded employer.

The mandate that requires employers issuing 250 or more annual W-2s to include the annual value of health coverage on the W-2 is pretty straightforward and most, if not all, employers are ready to comply for W-2s issued in January 2013 for the 2012 tax year.

Regarding health FSAs, the maximum amount an employee can contribute is being capped at $2,500. Previously, there was no stated limit to these tax-favored plans. Not many employees currently contribute more than $2,500, so this new provision primarily affects higher paid employees.

What provisions of the act will employers need to deal with in 2014?

2014 is the year that many of the big changes required by the reform act will take place. The state insurance exchanges, where smaller firms and individuals can purchase medical coverage, will be in place in 2014. Also, the requirement that employers ‘pay or play’ will take effect. This means that employers with 50 or more full-time employees are required to provide coverage that meets the ‘affordability’ and ‘coverage’ rules or face penalties. However, companies with fewer than 50 employees will not face these penalties. Employees will also face a tax penalty if they do not purchase required coverage.

Assessing the impact, determining the best strategy to navigate through these reform changes and, at the same time, maximizing an employer’s benefit spend can be very  complex. Determining the exposure and risk depends on an employer’s size, industry, location, the mix of part-time employees, the company’s core values and other factors. The law will have a greater impact on employers in certain industries (e.g. retail, hospitality) in which the number of hours that employees work changes frequently. To avoid penalties, many employers in these industries will likely need to offer some form of health benefits to employees who didn’t have them previously. Because there is no universal answer as to what an employer should do, employers should partner with trusted advisers to help them strategize through this process.

Are there parts of the legislation that can ease an employer’s pain?

Yes, some new regulations are being released that give temporary relief, particularly for companies facing the largest penalties for not offering ‘adequate and affordable’ coverage. For example, recent notice was given that allows employers to take up to 13 months to offer coverage to employees who do not consistently work an average of 30 hours a week. Previously, the legislation was interpreted to mean that coverage had to be offered to these employees in 2014.  For companies that have a large variable-hour work force, this notice has delayed millions of dollars in potential costs.

How might reform play out in the long term?

Regardless of the November election outcome, we expect that the major features of this legislation will remain, albeit with delays and changes. Employers can best prepare by relying more heavily on consultants and advisers to handle the significant changes over the next few years.

Paul Baranowski is Director of Account Management at Benefitdecisions, Inc. Reach him at [email protected] or (312) 376-0436.

Insights Employee Benefits is brought to you by Benefitdecisions, Inc.

How the health care landscape is evolving through internal and external pressure

Rob Rogers, Principal, Findley Davies, Inc.

Health care providers such as hospitals — particularly the more enlightened ones — started to reform years prior to the Patient Protection and Affordable Care Act (PPACA). Although the law crystallized the industry’s direction, health care systems faced pressure to reinvent themselves long before the act. This reinvention has not only affected the delivery model but also the human capital requirements within the health care system.

“There’s a big shift to outcome-based rewards as opposed to transaction-based rewards,” says Rob Rogers, a principal and health care industry leader at Findley Davies, Inc. “In other words, what is the quality of care provided as opposed to how many units of X were done in the fiscal year.”

Smart Business spoke with Rogers about the outlook for hospitals and health systems, and what this means for business owners.

How will reform affect revenue and other financials for hospitals and health care providers?

The topline or gross revenue for health care systems — which can either be an integrated network comprising multiple hospitals, physicians, clinics and outpatient treatment centers, or an independent community hospital — is going to jump. In particular, hospitals will have more patients as result of 30 million people now being covered under an ‘insured’ delivery system. Providers face the challenge of bolstering staff while facing a shortage of nurses and physicians.

Despite volume increases, net revenue will come under a lot of pressure as reimbursement levels from insurance carriers and Medicare and Medicaid continue to decline. Health care providers are being forced to scrutinize operating expenses to ensure they are providing care as efficiently as possible.

How will patient care be impacted?

More focus on clinical outcomes is one good thing occurring through reform — not necessarily the governmental legislative act, but the whole process. The health care system has recognized, based on internal pressure and pressure from employers covering health care costs, that patients and plan sponsors aren’t interested in paying for the volume of diagnostics. The reform focuses on keeping people healthy. If there are health problems, then the attention shifts to measuring outcomes such as the success rate of treatments, morbidity rate, length of hospital stay, patient satisfaction, etc. Health care systems must learn to cope with the continuous challenge of providing the right mix of care while, at the same time, getting paid for it.

What kind of consolidation and collaboration do you expect?

More collaboration among providers and consolidation of various related-care entities have already started. Some think only large health care systems will be able to operate in this new environment because they have enough volume to manage the margins better. However, while community hospitals will continue to operate independently, there will be pressure for them to partner with other community hospitals or to create alliances with the larger hospital networks.

Physicians are also building more partnerships. In 2010, for the first time, more physicians were employed by organizations such as hospitals and other related entities than were in private practice, though many independent physician groups exist in Ohio.

Health care reform works to eliminate silos of treatment. So we’re seeing the development of an integrated delivery model, with numerous entities working together under one umbrella to provide more efficient and better quality care. To remain competitive, physicians are creating alliances with patient care providers such as hospitals and nursing homes.

How will the operating procedures for health care providers differ?

Health care systems are taking a more proactive role in physician and nurse development and recruitment by providing financial assistance to university students in exchange for employment arrangements. With the assistance of experts to provide strategy, hospitals are looking at how they attract, retain and reward physicians, senior leadership and nurses to ensure staff is highly motivated and delivering quality care.

Most health care systems and hospitals are not-for-profit, tax-exempt organizations. As pressure increases from the public, Congress and state legislators, most health care providers are paying close attention to transparency in everything they do from audits, executive compensation and governance. More and more tax-exempt organizations are operating like public companies, which must comply with Sarbanes-Oxley requirements.

There isn’t a more public entity than a tax-exempt organization — the general public is the taxpayers. Rules governing the reasonableness of executive compensation and benefits under intermediate sanctions statutes are creating added pressure on health systems to ensure transparency and objectivity when dealing with executive rewards.

How might these changes impact business owners who provide health care plans?

The reform, apart from PPACA, is going to be mostly positive for business owners. While there may be additional costs associated with reform, the system will be more efficient with more focus on preventive care and wellness, which are steps in the right direction. There will be more integration with fewer silos of care. There’s more concern with helping the patient get from A to B to C without jumping through hoops. It will be less costly, more efficient and the outcomes will be better, which will make employees healthier.

The health care industry is rapidly changing. As health care providers work to deliver more efficient, better quality care, employers and employees both should be able to reap the benefits.

Rob Rogers is a principal and health care industry leader at Findley Davies, Inc. Reach him at (216) 875-1926 or [email protected]

Insights Human Capital is brought to you by Findley Davies Inc.

How health care reform will potentially impact employers

Marty Hauser, President, SummaCare, Inc.

The Patient Protection and Affordable Care Act (PPACA) was signed into law on March 23, 2010, and since then, the health care delivery system has experienced rapid change. Health care reform will be the biggest change to the U.S. health care system since Medicare was established in 1965. According to KPMG and Milliman reports prepared for the Ohio Department of Insurance, nearly 1 million more Ohioans will shift to Medicaid in 2014 at a cost of $250 million to taxpayers. It is estimated that this will increase to $600 million in 2019, while another 524,000 individuals could shift into the proposed government subsidized exchange. It’s also estimated that 660,000 fewer Ohioans will get their health insurance coverage from their employers. Not only does health care reform impact the way health care services are covered and administered, it also changes the delivery of health care and the ways consumers will obtain insurance. In addition, employer groups that offer benefits to their employees will experience change due to health care reform laws. Therefore, many employers have questions regarding how they can continue to offer comprehensive benefits to their employees while maintaining the costs of such benefits. “The small- to medium-sized employer will definitely be affected by the new legislation,” says Marty Hauser, president of SummaCare, Inc. “Many employers plan to continue offering benefits to their employees, but the way these benefits will be offered and the contributions made by the employer will likely change.” Smart Business spoke with Hauser about changes and mandates under the health care reform law, as well as post-reform strategies employers may use when offering benefits. What changes under PPACA have already gone into effect? In 2010, changes include coverage of children with pre-existing conditions; coverage of dependents up to age 26 under federal law and up to age 28 under Ohio law; elimination of lifetime limits of coverage; regulation of annual dollar limits of coverage; and a prohibition against rescission of coverage. In addition, certain preventive services became covered at 100 percent for most policies. What changes under PPACA are up next? While many of the changes under the PPACA law will go into effect in 2014, others will take effect in the coming months, and insurance companies are busy making appropriate preparations now. In August 2012, new women’s health preventive services, including contraception, will be covered at 100 percent if received in-network. These services fall into the categories of evidence-based screenings and counseling, routine immunizations and other preventive services for women. For policies issued or renewed after Sept. 23, 2012, insurance issuers will be required to distribute Summary Benefits of Coverage (SBC) documents to potential enrollees upon application and upon renewal. These documents will allow consumers to easily compare plans from different insurance companies. Under the law, two new resources scheduled to be available for consumers to purchase policies. Consumer Orientated and Operated Plans (CO-OPs) go into effect in 2014 and will offer consumers more choice when it comes to purchasing an insurance policy. CO-OPs are nonprofit groups designed to offer individuals and small businesses more affordable options, and their customers will direct them. Low-interest federal loans will be available to eligible private, nonprofit groups to help set up and maintain the CO-OPs, which can be operated locally, statewide or across several states. The second new resource for consumers in 2014 will be exchanges. Exchanges are state-based transparent, competitive insurance marketplaces, administered by a governmental agency or nonprofit organization, where individuals and small businesses with up to 100 employees can buy affordable and qualified health benefit plans. Standard benefit tiers will be offered on each exchange, and states will have broad latitude in design of the exchanges. All plans offered on the exchanges will be guaranteed issue with no medical underwriting, and some consumers may be eligible for subsidies based on their income. What strategies might employers use so they can continue to offer health insurance to their employees in the post-reform market? Strategies include providing employees with a stipend to pay for health insurance in the individual market or providing a defined contribution and moving to the purchase of policies on the exchanges. Another strategy is offering a policy that promotes a culture of wellness that features a smaller network, larger employee contribution or incentives for meeting wellness and/or preventive care goals. Employers may also continue offering benefits in the same manner as they have in the past. What changes are insurance carriers making? While the focus of most carriers has always been to provide cost-effective care in the most appropriate setting, insurance carriers now are participating with providers in creating Accountable Care Organizations (ACO) and Patient Centered Medical Homes (PCMH) that aim to further provide savings and promote coordinated, appropriate care.  More information and education about these activities will be forthcoming in the near future. Where can employers get more information? Begin with your current insurance carrier or broker. Share questions or concerns. You can work together to determine the best option for your business. Also, provides information that outlines the basics of the reform law and its provisions.  Regardless of the final outcome of PPACA, health care delivery will be changing. With the spotlight on quality, effective outcomes and transparency, the move toward improving the delivery system is certainly well under  way. MARTY HAUSER is the president of SummaCare, Inc. Reach him at [email protected] Insights Health Care is brought to you by SummaCare, Inc.