The Affordable Care Act (ACA) will begin to take hold during 2013-14. Consider your options… and do not be surprised.

With its final electoral challenge removed in November, most provisions and edicts of the Affordable Care Act (ACA) will begin to take effect during 2013 and 2014. The proposed changes will be substantial to both the users and buyers (and funders) of healthcare in US markets.

Over the last two years, Wilkening & Company has written several articles on the impact of ACA on employers and employees. In these articles we have endeavored to forecast coming trends and market changes, comment on the implications of these changes to the healthcare landscape and advise readers regarding prudent actions to take. To review all or some of these, please refer to the links provided at the end of these comments.

My purpose here is to make two suggestions to employers as they approach these imminent healthcare-market changes in 2013.

First, if you already provide employee health insurance coverage and support, reevaluate your current strategy for delivering employee health insurance and see if it still works under to-be-imposed ACA mandates. Get help if you need it, but be sure someone in your organization is responsible for helping set a course (and seizing the unseen opportunities) that will get you through the next two years—at minimum cost and maximum employee satisfaction. Ignoring the issue will not work.

Second, if you are a small employer (under 50 full-time employees in the current ACA version) and do not supply health insurance, the new law will generally not apply to you. But, do not think you can ignore its impact or its rules. Why?

• The healthcare marketplace will change forever under ACA and benefits will begin to look and act more like compensation. In other words, perhaps you want to take a second look at employee health coverage and its cost—and visibly shift your “pay costs” around a bit. Also, expect federal and state government to get rather picky regarding the definition of part-time employees (we understand the IRS has or plans a 10-page form for reporting employment information to determine the number of full-time employees on your staff).
• When your employees have seen “Paris” (i.e.: the new features and benefits of ACA coverage and availability) they may become quite vocal about wanting some of that for themselves. Do not be surprised if your attractiveness as an employer suffers without health coverage or a pay subsidy. How will you respond?

In the end, remember that offering and delivering healthcare insurance to your employees is more than just a cost line on your profit and loss statement. It is part of your employment deal with your employees. So ACA will do more than just cost you more (or less) money than before. It will also get right into the middle of that deal you have with your employees—for better or worse.

On a similar note, many expect 2013-14 to be healthcare market chaos as the Federals are not ready to implement the 2,000+ pages of rules they have written. We recommend that all employers watch the ACA implementation & markets carefully and do your best to screen or protect your employees from state or Federal shortfalls and mistakes.

Any good company goes on the offensive when challenged. Do the same with ACA.

Wilkening & Company E-Notes previous articles on the Affordable Care Act—

July 2012   |   April 2012   |   June 2011   |   August 2010   |   June 2010

Wilkening & Company has assembled a respected team of tax, legal and risk-management experts to help clients navigate the uncertain waters known as ACA and to help them reach a cost effective and complaint outcome. We are trying to become a “go-to” resource in these trying and uncertain times. If you are concerned about what actions to take next, feel free to call or write Wilkening & Company at (847) 823-5090, bob@wilkeningco.com.

Making December the First Month of the Coming Year

In our experience, December is the slowest and least-productive (or threatening) month of the year. It is the land between Thanksgiving and Christmas and not a whole lot happens or is typically planned on the business front.

This is a practice and underlying attitude that has some of its roots in history with companies that would shut down plants for annual maintenance and restoration during December—and furlough staffs for forced year-end vacations. There was not much left to do for the folks in the office. Even today, December is still a time for companies and their employees to “shutdown.” While the years have passed, we find the practice generally remains. Hence, a company can lose up to an entire month in its business cycle and productivity.

If this sounds familiar to you, we suggest that you take a step or two to change the pace of December and effectively make it the first month of next year. We think this can be done by asking your executives and staff to think hard about the basics of the (their) business for the coming year, and look for improvement. Try doing these 3 things this December to build for 2013:

1. Conduct all next-year account reviews by mid-December. Have your sales and logistics staffs review major accounts that are responsible for 80% or more of annual volume or profit. The account “team” should present their next year’s plan to improve sales and profits for each and all accounts—more calls, more products, fewer deliveries, higher prices…… (i.e.: What will be done, how and who will do it?) This plan is the foundation for current account planning in the coming year. And, do not forget to talk about prospective accounts.
2. Ask your direct reports and staff to commit to one thing they will do in the coming year to make the greatest contribution to company success—that can be measured. They should also describe how their single action will support the company strategy. Delegate these discussions all the way through the ranks of the organization. And measure the success of these individual actions throughout the year, by asking each employee to measure and self-report.
3. Commit to improving the effectiveness of one or two variable pay plans for the coming year and finalize the changes and analyses by December 25^th (Bah humbug). You then have a week or three to prepare to communicate the change.  Of course, you should start earlier than December, but much of the heavy (and visible) lifting will likely occur during that last month of the year.

As you can see, the above three type of action steps are designed to ask executives and staff to prepare for and make decisions regarding 2013 action plans, and complete that planning before year’s end. By setting these expectations for December, you are giving the message that you want your staff making sales calls, talking to prospective accounts and finding ways to improve profits and service on January 2nd—not just talking about it. 

Now some would say that by moving planning from January to December will do nothing more than just move lost selling and account-contact time from one month to another. The reality is that buyers and decision makers are less available in December than at any other time of the year [it is their shutdown, you know].  Hence nothing is lost. It is just better use of your executive’s and staff’s time.

If you do not like the three December actions I have used above or already do them, pick 3 more of your own. But, definitely do something to make December the first month of next year. It should not be too hard to count up the benefits in terms of improved selling and productivity.