Opt Out Benefit Suprise – May Be Subject to ACA
The Texas and Oklahoma systems get an Opt Out benefit surprise. Oklahoma and Texas will be the two states with opt out provision in their Workers Comp Laws. One of the areas of concern with the upcoming passage of the opt out provisions is that all benefits will be subject to Obamacare in 2014.
Section 2715 of Obamacare is known as the SPD section. All benefits that are provided to employees by their employer must be in the SPD (Summary Plan Description). As Workers Comp in an opt out program is no longer actually a Workers Comp program, the benefits will be a health and disability policy administered by the employer.
This may be a development of little consequence, however, as each section of the Health Act will only be known in 2014 and forward. Our Supreme Court says it is a tax – but regardless the SPD’s will be directly monitored and enforced -(by the IRS?)
One Texas and two Oklahoma insureds are considering the opt out programs once the bill is signed by Oklahoma’s Governor. All three companies did express this concern.
There are other areas of the Health Act that opt outs may be subject to in the future. The companies may want to consider testing the water before “jumping into the river.” In other words, companies in Oklahoma and Texas that decide to use the opt out method may actually be Federalizing their Workers Comp benefits.
The crystal ball on the future of opt outs may still show these types of programs as the future for Workers Compensation. Jumping right in may prove the water to be very cold. The opt out benefit may not be what a company expects from the ACA.
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