Central Ohio Businesses Want Decision On Health Care Law

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Columbus Chamber of Commerce president, Michael Dalby, says area businesses await U-S Supreme Court decision on the constitutionality of the Affordable Care Act(Photo: Tom Borgerding/WOSU News)
Columbus Chamber of Commerce president, Michael Dalby, says area businesses await U-S Supreme Court decision on the constitutionality of the Affordable Care Act(Photo: Tom Borgerding/WOSU News)

Sometime in the next couple months, the US Supreme Court will decide the fate of President Obama’s health care law. The decision will affect just about every business in Central Ohio.

Businesses are not making bets on the Supreme Court decision.. they just want a decision.

“I don’t think there’s any handicapping at all. I think they’re just trying to figure out, let us know as quickly as possible what’s going to be happening here so we can really make the plans,” said Michael Dalby, head of the Columbus Chamber of Commerce.

Dalby says future health care costs for employers are an accounting wild card. Dalby says healthcare costs for many companies can eat up to 20 percent of gross revenues. And as long as there are legal question marks, “You’re going to have businesses that just don’t know what they should be doing,” Dalby said.

As a result of challenges to the new federal health care law, there are indications some area companies are turning to contract workers rather than putting them on their own payrolls. Here’s why, if a company has more than 50 people on its payroll, starting in 2014, the Affordable Care Act will penalize the company if it does not offer health insurance to its employees. The penalty will be $2,000 per employee.

One Columbus based temp agency executive says that provision is helping his company. Dawson Careers executive Chris DeCapua says his first quarter placements are up 40 percent compared to last year. The improving economy is a factor, and says DeCapua, so is what he calls “tremendous uncertainty” surrounding the health care law. He says small companies find it cheaper to pay his fee and let Dawson provide the health insurance.

“So there’s no incentive for companies to want to have more employees because it’s based on the number of employees you have. So, companies are going to use services like ours to not have as many employees but they still have the work that needs done. But, I think once it’s resolved you’re going to see companies start adding people onto their payroll again,” said DeCapua.

Central Ohio companies which offer health savings accounts to offset health insurance costs are also waiting for the high court’s decision. Glimcher Realty Trust offers two types of health insurance plans, a network based plan and a high-deductible plan with lower premiums. For Glimcher employees who choose the high deductible plan, the company contributes money to Health Savings Accounts for them.

Glimcher Vice president Grace Schmitt says the new law could affect the cost of the accounts, possibly making them less attractive to companies and employees. That’s because the law caps tax free contributions to the accounts at $2500.

“Some of the provisions of that are still to take place in 2014 will be a tax, you know a payroll tax on the value of their health care benefits.”

Schmitt says Glimcher and other employers also expect health insurance companies to change coverage and rates – based on the new law.

“How the health insurance community reacts to it and what types of plans are available to us as an employer may definitely shift and will likely definitely shift due to the health care legislation, “says Schmitt.

Back at the Chamber of Commerce, president Michael Dalby, confirms that many Central Ohio businesses prefer a straightforward decision on health care law rather than more political debate. And, Dalby says the sooner the better.

“Honestly, if the government comes up with a plan that looks good and an employer says if I just have to pay a fixed cost and that covers all my employees even though I’m using the government type plan and not getting my own health care insurance then I’m fine with that.”

Dalby adds that business would welcome any plan that would avoid double-digit increases in health care costs.

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