Issue link: http://read.dmtmag.com/i/117824
Economics Health care reform It���s mostly bad news for employers. by Geraldine Warner H ealth care reform has taken what used to be a simple business decision about which employees get health benefits, and under which conditions, and converted it into something that���s so complex that employees might want to hire professionals to figure it out, says Sheldon Blumling, attorney with Fisher & Phillips LLP in California. The new health care regulations were drawn up by the Internal Revenue Service, the U.S. Department of Labor, and the U.S. Department of Health and Human Services. ���Anybody who wants to sit down and read up on all of this, I think, can do their own projections, but the reality is very few business owners have the time or patience to do it,��� Blumling said. Typically, employers are reaching out to accountants, insurance brokers, and consultants to do their evaluation. Many insurance brokers will do a projection without charging because they want to get the insurance business, he said. Although not all the regulations are finalized, and some will be refined, most of the guidance employers need is already there, Blumling said. On the positive side, the health reform will make health insurance available to people who���ve never had it before, Blumling said. ���But if you just put your employer hat on, there���s very little good news. It���s mostly bad news���higher taxes, higher administrative burdens, and less freedom in how you design your plan. No employer would want any of those things if they didn���t have to have them.��� A requirement that won���t take effect immediately concerns companies with more than 200 full-time employees who will have to automatically enroll new full-time employees in a health benefits plan unless the employee opts out. The U.S. Department of Labor is expected to issue rules on that in 2014. The Wenatchee Valley Traffic Association, which represents fruit growers, packers, and marketers in north central Washington, has been working with its insurance broker Maloney & O���Neill of Spokane, Washington, to help the industry understand the implications of the new health care regulations that go into effect in January. Manager Charlie Pomianek said the Affordable Care Act will bring major changes to all businesses going forward. ���If a grower has more than 50 employees, it���s going to flat out increase their costs substantially,��� he said, referring to the employer mandate requiring them to provide a health insurance program for employees. Burden But it���s also going to be a burden on growers just to figure out if they meet the threshold of 50 full-time equivalent employees because they need to add up hours worked by part-time employees to calculate the number of full-time equivalent workers. ���Let���s imagine you���re an apple, pear or cherry grower,��� Pomianek said. ���You have 40 full-time employees and you hire somebody for six weeks to do pruning and then he���s not working any more for a while. Then he works again for thinning, and then he���s not working any more. Then he works for 90 days to do harvest. Then you might hire him again for a few weeks as a part-time employee again to do orchard cleanup. ���The biggest burden on growers that would be caught in that middle range, I would think, will be the paperwork to determine if you���ve reached that 50 threshold or not,��� he said. ���It���s really a mess. I don���t know if we have a full understanding of how we���re going to count these hours for all the seasonal workers in agriculture.��� Maloney and O���Neill have developed a computer model to assess the impact of the new regulations on their clients. It can tell employers what options and strategies they have for covering their employees and whether it���s more cost effective for them to not provide a health plan and pay a penalty or to provide coverage. ���It���s a really difficult issue for the industry, but not necessarily your small growers who don���t have a large fulltime staff,��� Pomianek said. ���If you have 100 acres and they���re all in one place, you probably don���t have 50 fulltime employees. ���Everybody���s got a lot of deep concerns right now,��� he added. ���But it���s kind of like my Polish grandfather told me: It���s never as bad as you think and never as good as you hope.��� Last straws Still, the compounded impacts of health care and other new requirements may be the last straws for some growers, says Kirk Mayer, manager of the Washington Growers Clearing House Association. Some growers have left the industry or are thinking of selling their operations because of the uncertainty surrounding health care reform, immigration reform, and food safety audits. Mayer said the growers are typically in their early sixties and were planning on retiring in another five years or so but are worried about the potential impacts of those three issues. ���They���re saying, ���I just feel like if I want to stay in business, I have to learn my business all over again from the ground up. And there���s not enough time in my career to do that,������ Mayer said. ���We���ve had a number of growers tell us they were selling to another grower or they were small and taking some of their orchard out and hoping to develop the land.��� ��� WHO qualifies? O Pruning Platform��� Save 40% on Labor. Accommodates 6-10 Workers. Custom-Built Options Available. Easily removable platform to still be able to use the tractor. ���Serving Area Farmers Since 1939��� 1308 East Mead YAKIMA, WA 509-457-8105 28 ���Your Ag Equipment Specialist��� 800-827-5138 burrowstractor.com QUALITY SERVICE QUALITY PARTS April 1, 2013 GOOD FRUIT GROWER 927 Wenatchee Ave WENATCHEE, WA 509-888-0355 Mow and Spray at the Same Time. 7��� Mower w/40 Gallon Sprayer, electric or hydraulically driven centrifugal pump available. nce you have determined that you qualify as a large employer, you need to figure out which of your employees are considered full time under the health care regulations. Basically, this is done by looking back for a ���lookback��� period of 3 to 12 months and calculating how many hours employees worked. Anyone who averages at least 30 hours of work per week during that period is a full-time employee. Paid vacations and holidays count as working hours. Employers must treat those employees as full-time employees for a subsequent ���stability��� period, regardless of how many hours they actually work. The stability period must be at least six months but can���t be shorter than the look-back period. Employers can use an administrative period of up to 90 days between the look-back period and the stability period to figure out which employees are eligible for coverage and notify and enroll them. Conversely, employees who worked fewer than 30 hours during the look-back period and are not considered full time, do not need to be treated as full time during the stability period. During the stability period, a new measurement period would take place to determine the continuing eligibility of employees. Newly hired full-time employees must be offered health coverage within three calendar months of their starting date. Note that this is just a summary, and there are many rules and variables for the measurement and stability periods both for ongoing employees and new hires. ���G. Warner www.goodfruit.com