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Obamacare effects: unknown and disputed

The Affordable Care Act, commonly known as Obamacare, has significantly changed the health care industry for both providers and individuals. Website issues, changes in existing coverage and tax changes are adding confusion and complexity, according to local business people, tax preparers and health care providers.Colorado has been spared most of the website issues plaguing the national health care exchange site, according to Connect for Health Colorado. The national healthcare.gov site had significant crashes and errors when the exchange sites opened in October. Individuals and families can use the Colorado site at connectforhealthco.com to research policies available in their county, along with premium assistance subsidies for which they qualify. The premium assistance subsidy for individuals will add complexity to tax returns. ìWe’re not getting a lot of questions yet; I don’t think a lot of people understand the effects of the ACA on their taxes,î said Cary LaVigne of Accounting Pros in Colorado Springs. ìThey’ll realize it next year when they see it on their tax returns.î The premium subsidies are not considered taxable income; however, they are an advance on the premium tax credit that would otherwise be received on their tax return. This could reduce the return individuals might expect.According to the IRS, individuals expecting to receive the assistance subsidy must purchase health care coverage through the state insurance exchange. Individuals and families who receive insurance through an employer or purchased directly from an insurance company will not receive the subsidy. If an individual or family chooses not to buy any policy, they will pay a penalty on their taxes.ìIt’s definitely cheaper to pay the penalty right now, if that’s the route you want to go,î LaVigne said. ìBut it’s only a cheap penalty right now; it will continue to go up over the years.î The 2014 taxes will include a $95 minimum fee per person for not being insured, up to 1 percent of oneís income. In 2016, the fee is between $695 and 2.5 percent of oneís income.Businesses with more than 50 full-time employees must provide ACA-compliant health care to their employees. If they do not, the business will pay an additional tax to offset the premium assistance benefit the employees will receive from the government. This encourages companies to hire part-time employees and reduce current employees’ schedules, LaVigne said. According to the ACA, full-time is considered an average of 30 hours per week or more.ìBusinesses are definitely targeting part-time in hiring,î said Gary Smith, marketing representative for ziprecruiter.com, a job board aggregation service. ìThey don’t want to have to pay that. On our website, we’ve got 85,000 jobs out there, and we’re seeing a lot more part time.îThe region’s larger health care providers are taking the regulatory changes in stride. ìThere are not a lot of changes we’ve had to make,î said Chris Valentine, director of marketing and communications at Penrose-St. Francis Health Services. ìA lot of the things we already do on an ongoing basis to stay ahead in the industry kept us ahead on ACA implementation.îThe region’s two major hospital networks foresee different financial impacts. ìMore people will have insurance, so our unreimbursed care costs will stop rising or even start to reverse,î Valentine said. ìIn the last fiscal year, we had $124 million in unreimbursed care expenses, just for St. Francis hospital. That’s unsustainable. We’re looking forward to people being able to pay for the care they receive.îMemorial Health Systems is concerned about an increase in bad debt write offs, resulting in increased net costs, said Rob Rush, Memorial’s director of business, community and governmental affairs. ìWe anticipate that bad debts will increase because of the change in level of coverage people can afford,î Rush said. ìIf someone was on an employer-offered plan before but the employer no longer offers it, they will buy a policy they can afford from the exchange. But if they get really sick and the out-of-pocket amount from their new policy is more than they can afford, then we won’t be able to collect.îThere are indirect benefits to hospitals and individuals when more people are covered. ìPeople with insurance and coverage tend to access care earlier,î Valentine said. ìThey will hopefully see their doctor with a cold or cough rather than waiting to come into the emergency department with pneumonia.î Reduced usage of the ED for preventable illnesses or issues that could have been cared for by primary care doctors will increase service speed and availability for severe emergency care, he said.Another possible benefit is an increase in quality of care because of changes in Medicare reimbursement, Rush said. ìReadmission reimbursement rate changes mean that if someone is treated and readmitted for the same reason within 30 days, the federal government doesn’t pay us for that care,î Rush said. ìWe’ve been aggressive in improving quality of care to make sure people don’t have to come back, to the point that we have one of the lowest readmit rates in the country.îTricare, the military insurance, and veteransí health care programs are automatically assumed to be ACA compliant, according to healthcare.gov. Individuals and families covered by those plans or Medicaid, Medicare, COBRA or university student plans will not have to pay penalty fees. However, they will not be eligible for the subsidy or tax credit.Other less publicized changes impact smaller health care providers, said Dr. Stephen Kutscher, Falcon chiropractor. Changes in privacy and patient information protection will improve medical history security but increase efforts for providers, he said. ìIf someone is coming in to clean the carpets, I have to do a risk assessment to determine if there’s a chance that contractor will see or have access to patient files,î Kutscher said. ìIf they do, I have to make sure they have procedures in place to protect information, and disclose it to my patients.îPolitical movements and lawsuits aimed at changing or repealing aspects of the ACA add uncertainty to the effects the health care industry will see in the new year.Lawsuits initiated by the Catholic Church concerning the employer mandate to provide coverage for certain types of birth control are ongoing. However, on the provider side, Penrose-St. Francis doesn’t see any impact on their spiritual care mandate, Valentine said.ìThe genie may be out of the bottle,î Kutscher said. ìThe individual policies that have been canceled on people are gone forever; you can’t just bring them back.î

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