Since the Patient Protection and Affordable Care Act (PPACA) was enacted in March 2010, HR departments have been working to make necessary changes to their health care benefit programs. The most significant changes must be made by 2014. The effects on health plan administration will be dramatic, as employers begin to deal with new players in the health insurance arena; state insurance exchanges.
PPACA was passed to ensure that no U.S. citizen is to be without healthcare insurance. The passing of the PPACA bill will require vast changes to how the U.S. government, and organizations benefits departments implement this nationwide healthcare. These changes that will take effect in the upcoming years of 2014-2015, will be the largest ever addressed in recent years, specifically given the large amount of uncertainty of the short- and long-term effects. The purpose of this paper is to outline and discuss some of the key issues that will be faced to employers in the U.S. and a focus on the impact of the PPACA on human resource departments.
Health reform will have a large financial impact on America. The bill is expected to cost $940 billion over the next ten years alone (Silverleib, 2010). This is one of the overall, most expensive pieces of legislation ever passed by the US government. Even though the amount of money Americans spend on health care each year dwarfs this cost, it is still a large portion of currency that the government will have to acquire. The nearly one trillion dollar bill will be funded partly by higher taxes. The higher a person’s income is, the higher the income tax rates they will face. This means that half of American’s who are required to pay income taxes will be hit hard by this, while the other half of the citizens who are not required to pay income tax, won’t be as affected. This amount of money spent in this amount of time will inevitably have an effect that large on America’s economy. Insurance coverage will now be expanded to an additional 32 million uninsured people by 2019. This means that 94% of Americans will have health insurance by that time (Evans, 2012). The PPACA allows for children under the age of twenty-six are able to remain on their parents’ insurance plan (Appleby and Steadman, 2011). Prior to the PPACA bill, young adults who had graduated from college and were living on their own would no longer be covered under their parent’s health insurance, they would only have coverage if they purchased coverage for themselves, or have coverage through an employer the provided health care insurance. The PPACA allows for affordable coverage for this specific group, and millions of people will benefit from the insurance coverage.
The Health Care Bill will have both positive and negative effects on certain individuals in America. On the plus side, if and when an individual has health difficulties, the individual will find it easier to receive health insurance coverage. Specifically individuals who have a pre-existing condition disease, have found it hard and expensive to find health insurance coverage. So “undeniable” coverage will definitely be helpful to people who had been denied coverage before. However, on the other hand, people who refuse to purchase health insurance will face being penalized with a fine by the IRS. Starting in 2014, individuals who do not have health insurance coverage will be fined either $750 or two percent of their income, depending on which ever is more, and will grow over time (Silverleib, 2010). The PPACA bill was a challenge to get passed, and within minutes of the bill becoming a law, the PPACA was challenged by 13 state attorney general’s jointly filing a lawsuit claiming the new law violated the Constitution (Ferholtz, 2010). This suit was filed in the U.S. The National Federation of Independent Business and 7 additional states joined the suit as...
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