Benefit plan — The federal government will draft by 2014 an "essential benefit package" that will be a required offering by employers providing health insurance. We are based in Massachusetts, the only state to enact health reform, and we have what is called minimum creditable coverage — the minimum plan design a person can have. It may be the model for the federal government, and it may be richer than what you currently offer.
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These are the highlights, and there will be more to come. Our major concern for the industry is this: How can your company remain competitive, especially in any long-term contracts you may have or are bidding on now, when these unforeseen costs hit your bottom line?
We conducted an in depth review of these changes for a client and in a reasonable case scenario, their fiscal 2010 cash flow would have been reduced by $1.55 million or 10 percent had all of the act's provisions been in place for the 2010-11 school year, without any additional compensation from customers.
Companies and school districts that still operate their own student transportation need to prepare today for these financial penalties and burdens that begin kicking in this year and in 2014. Companies need to engage in a comprehensive review of their current plan, their employee make-up, and how health reform may bring material costs to their organization.
Christopher Nadeau is a principal with William Gallagher Associates (WGA) in Boston and is the leader of the employee benefits practice nationally. He is chairman of the Council of Insurance Agents & Brokers, where he has spoken with members of Congress on health reform, and participates on various boards and industry advisory groups, including Blue Cross Blue Shield of Massachusetts, Delta Dental and UNUM. Prior to joining WGA, he was the practice leader of a competitor firm and spent nine years in the insurance industry. Nadeau is a graduate of Bucknell University. He can be reached at email@example.com.
Scott Kirschner is a vice president in the employee benefi ts practice of WGA. Prior to joining the company, Kirschner was the director of the employee benefits practice at a competitor, as well as spending 14 years with Towers Perrin and KPMG and eight years in the insurance industry. Kirschner has written and spoken on many healthcare issues over the years and is a member of WGA's Health Reform Advisory Team. Kirschner is a graduate of Vanderbilt University. He can be reached at firstname.lastname@example.org.
William Gallagher Associates was founded in 1983 and is one of the largest property and casualty and employee benefit brokerage firms in the eastern U.S. For the third year in a row, WGA was voted the best firm of its size by the readers of Business Insurance. Learn more at www.wgains.com.