PTC coasts through Obamacare this year
Self-insurance fees to rise about 4% next year
The federal Affordable Care Act, often referred to as Obamacare, will have relatively little impact on the medical insurance offered to Peachtree City employees this year, the city council was told Thursday night.
Starting next year, the city can expect to see fees as part of the ACA that will see costs increase by an estimated 3 to 4 percent, according to the city’s insurance consultant.
The city budgets a bit over $3 million each year for its self-insured plan and has a policy that stops its overall loss at about $3.3 million, said Human Resources Director Ellece Brown.
In contrast, the ACA changes are projected to cost the city just $28,600 in fees for 2014, according to Ted Leathers, who is the city’s insurance consultant. Furthermore, the city will be able to keep its self-insured plan, though employees will have the option to purchase private insurance instead of they choose to, officials said.
The lack of effect from Obamacare is largely because the city’s insurance plan is already considered “affordable” and “adequate” based on the parameters which the ACA judges insurance plans. The city’s plan also already offers all of the required essential medical services in the act, Brown added.
The act requires, among many regulations, that insurance plans must offer preventative care services for free to the insured, and also that plans cover dependent children through age 26, even if they live outside of the parents’ home and even if they are married, Brown noted.
The use of a self-insured plan allows the city to pocket any overages in years when claims are lower than expected, and that’s money that would normally go to the insurance company as profit under a normal “fully-insured” plan, Brown said.
Last year, for example, the costs came in 11.2 percent under the expected amount, Brown said. Leathers noted that the city also has a reserve account funded for the self-insurance plan.
Brown said the way the ACA accounts for employee count has caused the city to restrict its part-time workers to a schedule of no more than 24 hours per week, because if they cross the 30-hour threshold even once they have to be offered medical insurance under the ACA.