Will Affordable Care Act Ultimately Result in Greater Contract Labor?

Posted by Tim Teague on Tue, Jun 21, 2016 @ 02:32 PM

Two of the driving tenets of the Affordable Care Act are the push for better patient outcomes and reduction of costs. Since labor spend accounts for the largest percentage of acute care expense, it is a prime target for cost cutting.


This presents a conundrum for the hospital. How to cut labor costs while improving the quality of care (decreased re-admission rates).  A corollary to this dilemma has been the “just-in-time” staffing models the industry has used for years.  The difference is while a manufacturer can judge work in process by the amount of incoming orders, the healthcare industry has not been able to predict the number of orders (average length of stay) in a reliable manner.


Peter Drucker, foremost business analyst declared just before his death in 2005 that “increasing the productivity of knowledge workers was the most important contribution management needs to make in the 21st century.” The question here is how can data be used to transform the healthcare industry to both decrease costs and improve quality?


The answer is equal parts simple and complex. There is enough historical data from millions of hospital admissions across the country to fine-tune a census model that provides extremely accurate daily figures for a unit-by-unit count. Several firms have been working on the analysis of these figures for years. In the same way the electronic medical records have grudgingly made their way into our healthcare system, strategic census models will soon be the norm.


When this data becomes granular for hospital systems, the current models for large scale census predictors will become extinct.  This new model for just-in-time staffing will finally provide a day-to-day, week-to-week picture of labor needs. Fine tuning the levels of FTE’s will become better, and non-fixed-cost labor will boom.

Tags: Affordable Care Act, Affordable Healthcare Act, Contract Labor, staffing, Staffing Agency

Don’t Let the Affordable Care Act Penalties Sneak Up on You!

Posted by Tim Teague on Wed, Nov 19, 2014 @ 06:30 AM

sneak-upAmidst the back and forth, the delays, and the political posturing surrounding the Affordable Care Act, DON’T FORGET THERE ARE SIGNIFICANT PENALTIES for employers for non-compliance.   The penalties are only for employers of 50 or more FTEs, but if your firm suddenly hits the 50 FTE threshold, penalties can accrue monthly. 

In simple terms, if you offer health insurance that covers at least 60% of costs, and the cost to the employee is not more than 9.5% of their family income, you should be safe. However, if just one employee elects to participate in an exchange, or receive a tax credit outside your company, your company will be flagged for non-compliance. Despite proof of valid coverage, you will need a paper trail that confirms compliance for every employee. This is where electronic signature technology can uncomplicate your administrative burden and provide a legal paper trail to assist in complete compliance. The penalty could be a minimum of $3,000, but for a small firm with 50 employees, it could be as much as $40,000 annually!

We have a sample document that is already loaded by our suppler, YouSignHere. This assures that each employee has been offered coverage, and what their election was.  

If you are interested in seeing that document and how to use YouSignHere for your healthcare election coverage forms please click below and we will be happy to send it to you for download.

Get my Free ACA Election Form

Tags: Affordable Healthcare Act, YouSignHere

What should the healthcare staffing industry expect from the ACA?

Posted by Doug Word on Tue, Jul 16, 2013 @ 10:04 AM

healthcare newsThe Obama administration announced earlier this month that it will allow businesses an extra year to comply with the Patient Protection and Affordable Care Act (ACA).

The law was originally slated to kick in Jan. 1, 2014 but the date for compliance has now been pushed back to Jan. 1, 2015. It will then mandate employers with 50 or more employees to offer minimum-value insurance and cover 95 percent of those workers through so-called employer shared responsibility requirements.

What should healthcare staffing agencies expect from this adjustment and from the ACA itself?

The announcement gives employers time to study whether or not complying with this facet of the law is in their best interest and plan accordingly. They will still have the option to “play,” meaning comply, or “pay” the government-mandated fine for non-compliance when the time comes.

The delay will benefit larger organizations that were prepared to remain well above the 50-employee threshold. Reporting requirements to the Internal Revenue Service (IRS) can now get pushed back a year for employers, insurers and other reporting entities without fear of penalty.

The reason behind the administration’s announcement to allow employers an extra year to prepare for implementation centered on the “complexity of the requirements and the need for more time to implement them effectively,” according to the Department of the Treasury.

Treasury also put forth two goals: (1) simplification of the new reporting requirements consistent with the law, and (2) adaptation of the health coverage and reporting systems.

Industry analysts have differing views on the influence of the act itself.

Justin Junkel, vice president of finance and analytics at Pinnacle anticipates four major developments as a result of the health care law:

  1. Companies will transition lower-skilled workers to shifts of less than 30 hours per week.
  2. Staffing firms will increase markups or bill rates to offset the costs of providing healthcare coverage and the associated administrative expenses.
  3. Health plans will adjust their costs to fall closer to the ACA minimums.
  4. The overall cost of healthcare coverage will rise over time, as companies make process changes to comply with ACA requirements.

Junkel also noted, “The ACA will result in cost increases for staffing firms, due to the requirement of providing healthcare coverage to previously uncovered employees or paying the taxes associated with not providing affordable coverage.”

Jeanne Knutzen, founder and CEO of the PACE Staffing Network, said:

“We are anticipating that the costs to become fully compliant with the law will require most staffing companies to ask for a two-to-four percent increase in client bill rates, just to break even; anywhere from 16 to 35 cents per hour.”

The ACA could help the temporary staffing industry in this way: some companies will want to remain below the 50-employee marker and turn to agencies with temporary and part-time labor.

Jay Hancock of Kaiser Health News said, “By requiring employer coverage only for those who put in at least 30 hours a week, the act appears to create an incentive for companies to do less with permanent workers and more with part-timers, which are the main focus of staffing agencies.”

Another workaround for the industry could be a regulation the IRS created last year known as the "look-back/stability period safe harbor method.” It essentially gives employers of “variable hour” labor, like staffing agencies, 12 months to determine whether or not an employee is a temporary worker or full-time worker deserving of health care benefits.

Bernard Wolfson of MEDCITY News noted, “The Affordable Care Act probably presents the biggest challenges to employers in industries that use a lot of part-time and seasonal workers. Their hours can vary dramatically from week to week or month to month, making it difficult to calculate who is eligible for benefits and who is not.”

The emerging consensus is the ACA is a complicated law that has the potential to impact companies positively or negatively once it is implemented. Companies that will be influenced now have more time to get out in front of the issues associated with the act, but understanding and implementing a strategic plan for the future is essential.

Tags: healthcare staffing industry, healthcare staffing trends, Affordable Care Act, Staffing Industry, Healthcare, Affordable Healthcare Act, ACA

Healthcare effects more than its own industry

Posted by Jennifer Kardell on Wed, Jun 19, 2013 @ 01:04 PM

healthcarelawyerSometimes in our own careers we don't stop and think about what is happening in other industries, sometimes we don't even think how our industry can effect other industries.

Think about it, in your healthcare staffing career have you stopped think about how other career fields work, how their staffing is handled, how their scheduling is completely different. I can't be the only one who hasn't stopped to think how my non-healthcare staffing friends search for jobs, hnadle their schedules or how their daily "work-life" is opposite from mine.

Now your probably, thinking "Where are you going with this?".

When studying to be in the healthcare fields, you focus on the different paths it offers such as the types of doctors, nurses and care-giver you can become. Once choosing your healthcare path you then think about the different facilities you can work in, such as hospitals, clinics or private practices.

Now here's the curve-ball, think about those studying to be a lawyer. Sure, they have some what of the same thoughts as any other career choice, choose the type of attorney you want to be and what setting you want to work in. Did you think that they have to study the basics of being a lawyer, but they also have to step in to our healthcare world.

With the new Afforadable Care Act, Lawyers are in high demand for the healthcare industry. Even companies in healthcare who have a strong, in-house law department. If someone is wanting to become a lawyer, now is the time to specialize in the healthcare world. Primary areas to specialize in include complex hospital mergers, Medicare audits and disputes over reimbursements.

Due to the ever-growing list of unknown questions it's wise for the healthcare world to keep a strong bond with their legal departments and keeping each other in the know with the changes that are about to happen to both worlds.

Does your company have it's own in-house legal department? Has your company considered amping up the need for legal services because of the new Affordable Healthcare Act? Let us know your thoughts and opinions!

Tags: healthcare staffing industry, healthcare reform, healthcare staffing trends, Affordable Care Act, Staffing Industry, healthcare recruiting and staffing software, Affordable Healthcare Act, ACA

What will Affordable Care Act actually cost through the State Exchanges?

Posted by Tim Teague on Fri, May 31, 2013 @ 02:25 PM

describe the imageAs the Affordable Care Act moves closer to full implementation, the real test is soon to begin. As state insurance exchanges prepare for open enrollment in the fall of this year, premiums for various levels of coverage are starting to take shape. Most eyes are on the State of California as it is as close as any state to publishing hard rates.  Despite the political arguments that continue on Capital Hill, there still remains much confusion over where the rates will wind up. The following articles, one from Forbes, and one from the Covered California website depict two entirely different scenarios. The Covered California article compares rates and shows that rates on average will be between 2% higher and 29% lower through the Exchange.

The next article from Forbes points out that the comparisons are not apples to oranges and that the real comparison would show an increase through the exchange of up to 146%. 

It’s amazing that even with hard numbers there doesn’t seem to be a consensus on the true cost.  In the actuarial universe, there are several factors that determine what insurance rates are required to support specified coverage.  Two of the more important factors in rate determination are average age of insured and the total size of the group covered.  As stated in a prior blog, these two issues are going to be the impetus behind a push in the second half of the year to advertise and enroll as many younger adults as possible. Although the implementation of ObamaCare has continued its march, there could still be a few legislative hurdles before full implementation. In the world of politics, expect the unexpected.

Tags: healthcare staffing software, healthcare staffing industry, healthcare staffing and recruiting software, healthcare staffing agency, healthcare staffing credentialing, healthcare reform, Obamacare, healthcare staffing trends, healthcare staffing payroll, healthcare scheduling software, Obama, Affordable Care Act, healthcare scheduling, Healthcare, healthcare recruiting and staffing software, staffing software, healthcare recruiting, healthcare industry, Affordable Healthcare Act, ACA

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