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National Restaurant Association - Health Care Watch: With minimum value's rules, the devil may be in the details

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Health Care Watch: With minimum value's rules, the devil may be in the details

This is one in a series of blog posts on the health-care law and the restaurant industry. The articles are written by Michelle Reinke Neblett, the National Restaurant Association's director of labor and workforce policy.

When we talk to restaurant operators about the health care law and how it will impact them, two questions always come up: what does the law require me to do and how much will it cost to comply with these new requirements? But primarily they want to know what the premium is for a plan they're now required to offer and how much they can ask their employees to contribute.

The law requires large applicable employers to offer full-time employees and their dependents minimum essential coverage that must be affordable to the employee and meets a minimum value or the employer could face penalties. But in order to begin to determine the premium for such a plan, you first need the rules for both tests - affordability and minimum value. The Obama Administration began addressing the affordability test last year, but final rules have not yet been issued.

In April, the Treasury Department began to consider rules for the second test - minimum value. Minimum value is a measurement tool used to describe the richness of a plan's benefits. Under the law, an employer's plan does not meet the minimum value required if the plan's share of the total allowed costs of benefits provided under the plan is less than 60 percent of such costs.

Treasury is considering offering employers three options to determine minimum value of their plan(s) and has requested comments on each one. The three options would consist of:

1. A minimum value calculator that could be posted on a website for employers to submit their plan information and receive a value

2. A safe harbor checklist similar to the eye-ball test used in Massachusetts

3. Obtain certification by a certified actuary of a plan's minimum value
We appreciate that options would be offered to employers, but there are concerns about some of the details, such as:

• The standard population to which employers will be compared may not reflect an employer's workforce and skew the results, and

• Too many employers may be forced to use the more expensive actuary certification option because they have nonstandard features in their plans that would not fit into the calculator or safe harbor checklist

The National Restaurant Association, our members and state restaurant associations have responded to those proposals through the Employers for Flexibility in Health Care coalition, whose comments also included the employer reporting requirements and the exchanges verification of employee eligibility for exchange coverage. Read our letter here. Tell us which option you might choose; e-mail us at healthcarereform@restaurant.org.

The Association is committed to your understanding of the law's requirements and its effect on your business. To understand the basics, visit the NRA's Health Care Knowledge Center. If you're interested in the regulations, visit our Health Care Policy page. We'll continue to keep you informed about current health-care implementation issues.

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