From a senior executive from the insurance and financial services industry who's read and studied all 2,000 pages.
Mark Brooks · August 22, 2013
As we approach the implementation of Obamacare, churches might do well to remember the words of Franklin Roosevelt who said, “The only thing we have to fear is fear itself!” Roosevelt uttered those words in 1932 at his first inaugural address. Today they seem timely still as we are about to see the biggest overhaul of healthcare ever with the launch of The Affordable Care Act (ACA), or as most know it, Obamacare.
At over 2,000 pages, few, including many politicians, have read what this bill actually contains and thus have little to no understanding of what it means, much less what it will do. This fear of the unknown has caused widespread disapproval that has become a political hot potato for many. And it has lead to a significant gap between myths and actual mandates for 2014’s full implementation of Obamacare.
Despite the rhetoric of repealing Obamacare, the bill seems to be here to stay, at least in some form. So, wise churches need to know how this will affect them. It is imperative that a church gets the answers to the key questions now so that they can be prepared for the full implementation of Obamacare.
One such expert in how this will all factor into a church’s thinking is Michael Brooks who heads up The Charis Group’s Benefit Consulting Services in Atlanta. Brooks retired as a senior executive from the insurance and financial services industry after a successful 30-year career. He spends his time now helping churches analyze and understand their health care plans. Brooks has read and studied all 2,000-plus pages of the ACA.
Fact or fiction?
Brooks feels that churches must separate out the myths circulating from the true mandates required by Obamacare. “Too often we react to what we don’t know,” he says. “It is imperative that a church understand both how Obamacare will and will not impact them.”
Brooks states that most churches in America will not have to experience near as much change by Obamacare’s 2014 full implementation requirements as is too often feared. That’s because the dreaded “Employer Mandate” (the myth feeding this fear) pertains only to employers with over 50 benefit eligible employees. (And now, even the financial penalties for non-compliance with this part of the law have been waived for 2014 to give employers better time to come into compliance.)
There are only a fraction of the over 300,000 churches in America that have over 50 benefit-eligible employees. Brooks states, “A church needs to account for other ministries within their sphere, such as daycare centers or schools, to assess if they are at or above the 50-employee threshold. If they are indeed below the 50 employee mark, then they will see basically very little, if any, change in their current offered health plans.”
How about rates? There is plenty of evidence among employers and employees that unknown, and thus feared big rate increases are coming with Obamacare’s 2014 full implementation. Asked if these rate fears were also based more in myth or truly were going to happen as part of the mandates, Brooks offered a tempered reply: “There’s no doubt that Obamacare 2014 is going to create rate changes for some. There are a ton of factors that go into an insurance company’s product pricing. But with Obamacare, these rate increases will have most of their impact on individual health insurance buyers and their impact on those existing group plans offered by employers most likely will experience rate increases similar to only what they’ve experienced over the past decade.”
Brooks adds this late-breaking statistic: “A just released survey by the Kaiser Family Foundation reports that, based on group health insurance rates filed by carriers for 2014 coverages, the national average rate increase for employer sponsored group plans is 5% for individual coverage and 4% for family coverage.”
A word about “Exchanges”
There remains the issue of those mysterious health insurance “Exchanges.” Aren’t these going to be an issue in 2014 for churches to deal with? When Brooks was asked about the Exchanges, his response stemmed from several conversations with church leaders he experienced at the recent NACBA Conference in Charlotte, N.C. “It was surprising to speak with so many church leaders who thought that because their state had opted out of setting up a state health Exchange that they were totally exempt from any impact. Many were surprised to learn that even if their state had opted out, that just meant that residents of any such state were left participating via the Federal Exchange.” But here is where the myth and the fear of the mandate got separated. “The bottom line,” Brooks says, “is that for churches who have an existing health plan, the Exchange’s barks are not going to have any bite. The real impact of the Exchanges is going to fall on individuals not having health insurance offered through their employer.”
So does all this mean for churches that Obamacare 2014 can just be ignored or that there’s really not much that needs to be done? Apparently, that’s not a good myth to indulge in either. It seems that almost every year there are new health insurance rules or regulations that church plans already have to adjust for. And Obamacare 2014 implementation is no exception [to] this. “There are some technical compliance issues that churches need to always be aware of, and 2014’s Obamacare implementation does have a few,” Brooks offers. “New limits on FSA caps and HSA limitations, re-defined parameters for self-funded plans and new basic required coverage levels and type, just to name a few.”
Armed with information
What should a church do, even if what’s feared isn’t as bad as what is actually coming? Plenty, again according to the experts. “The best way to eliminate fear,” Brooks insists, “is to get answers and the time to get them is NOW.”
It is clear that the vast majority of churches will continue to work with their same insurance representative or brokerage firm to secure their coverage for employees. There are additional, well experienced and knowledgeable professional consultants that can also help with Obamacare 2014. But what should a church ask?
Our consulted expert boiled it down to three basic starting questions: First, ask your health insurance representative what specific things your church needs to do today to be ready? Second, ask your representative to review your plan’s coverage and supporting documents to make sure the church is in compliance or what needs to be changed to get into compliance for 2014? And third, ask for answers that are clear and understandable and keep asking for that until you have them.
When it comes to Obamacare and the fear of church employers (and employees) there seems to be an available cure for Roosevelt’s fear of fear itself. It is to be found in clearly understandable information that can separate the myths from the mandates. The best thing is that all church leaders need to do is ask—now.
Editors Note: Worship Facilities Magazine will fully explore Obamacare in our winter issue. We welcome comments and advice for churches on this topic from all viewpoints.