• Reminders

    Important Dates:

    Fall HCAFA Executive Committee Meeting:
    • Friday, Sept. 22, 2017,  12:00 – 2:30,  IEA Office,   553 N. North Court, Palatine

    Fall HCAFA Meetings at Harper, in L202, Light Meal Served

    • Friday, Nov. 17
    • Friday, Dec. 15

    Summer 2017
    • Friday, May 12, 2017
    • Friday, June 9,2017
    • Friday, July 14, 2017
    • Friday, Aug. 11, 2017

    For information or to check if the time or location has been changed, call Hasmig or Amy at the IEA office
    (847 359-0300).

Everything You’ve Wanted to Know about the Affordable Care Act (aka Obamacare and ACA) and How The Act May Affect Your Teaching Hours

September 9, 2013
Fellow Adjuncts,

The following information is written for you regarding the Affordable Care Act (sometimes called ObamaCare) with the current information that the Higher Ed Adjunct ACA Coalition now has. This information may be updated in the future as the federal rulings come down about the ACA, but for now we hope that this will give you some idea of what is in store regarding health care for adjuncts in higher ed in the near future. If you have any further questions about the ACA, we urge you to go online to tinyurlcom/exchangetutorial for a sample of the multimedia educational materials explaining the application and enrollment process.1 There is also information on the NEA website,2 http://www.nea.org or the IEA website, http://www.iea/nea.org,3 as well as the Kaiser Family Foundation, http://kff.org/health-reform/.4 There are some other good websites listed at the end of these FAQ’s. All of these websites have a wealth of information on contingent faculty members and the ACA. A short list of FAQ’s, mainly from the NEA but supplemented by other information, follows.

Q1: Does the Affordable Care Act (ACA) require that institutions of higher education provide health insurance to full- or part-time contingent faculty members?
A1: No. Large employers are not required by the ACA to provide health insurance to contingent faculty members, whether they are full or part time. In this context, “large” means an employer with an average of at least 50 full-time employees, including full-time equivalents (FTE’s), on business days during the prior calendar year.

Q2: What is a “full-time employee,” and why are some employers worried about contingent faculty members’ hours of service?
A2: The law defines a full-time employee as one who works an average of 30 hours of service a week during a month, but it doesn’t indicate how to tally hours of service. Regulators have said that 130 hours of service during a month can be treated as the same thing as an average of 30 hours a week during a month. Regulators know that contingent faculty members spend time working beyond the hours they spend in the classroom. But if contingent faculty members are paid on a per-course basis, how to add outside-the-classroom hours to inside-the-classroom hours requires understanding how these employees actually work.

Q3: What have regulators said about counting contingent faculty members’ hours, and could what they’ve said change?
A3: Regulators have said that employers must use a “reasonable” method for counting contingent faculty members’ hours, and they’ve indicated that it would not be reasonable to take into consideration only classroom hours if a contingent faculty member also has outside-of-classroom hours. The approach taken by regulators is in effect unless and until they issue new, formal guidance. NEA is actively engaging with regulators at Treasury and the IRS to ensure that whatever comes out next will make sense for contingent faculty members, but we don’t know when new rules will be issued or what they’ll say.

Q4: Is it “reasonable” to assume that all contingent faculty members work the same number of hours outside the classroom?
A4: No, we don’t think it’s reasonable. Just like it’s not reasonable to minimize a contingent faculty member’s actual work hours for the employer by ignoring some or all of the hours spent preparing,
grading, and doing other work for the employer. Assuming that all contingent faculty members work the same amount of time could over-or under-estimate actual hours in most cases.

Q5: If across-the-board assumptions about contingent faculty members’ hours are not reasonable, what should employers be doing with respect to hours of service?
A5: First, they should be transparent about what they think contingent faculty members’ actual hours of service are. They should be talking about it with workers and their representatives—in advance of proposing any hours-related actions. But it’s also crucial that they don’t take precipitous actions that will undermine contingent faculty members, because the stakes are too high.

Q6: What’s at stake if contingent faculty members’ hours are cut?
A6: Contingent faculty members get paid little enough as it is, and cutting their work hours will make it even harder for them to make ends meet. Moreover, cutting their hours could mean that experienced faculty members teaching multiple courses give up courses that will be taught instead by new, inexperienced faculty; that would hurt students by depriving them of experienced faculty.

Q7: Will everyone be covered under the ACA (ObamaCare)? What if you don’t bother to enroll?
A7: Yes, the point is for everyone to be covered. If you do not enroll in coverage or have proof of some existing coverage, you may be penalized.

Q8: Will spouses or domestic partners and dependents of full-time contingent employees also be covered under the employer plan?
A8: No. Only the employee will be covered at this time. Spouses or domestic partners and dependents will be able to get coverage through the health exchanges.

Q9: What types of coverage will be offered?
A9: There will be four basic types of plans offered, Gold, Silver, Bronze, and Platinum. All will provide the essential health coverage benefits such as doctor, laboratory, mental health, prescription drug, and hospital services, but they will vary in the amount of the copayments, etc. The standard one used will be the Silver plan.

Q10: Won’t employers who don’t offer health coverage to full-time contingent faculty members face a penalty under the ACA starting January 1, 2015?
A10: Not necessarily. The ACA establishes possible financial penalties on large employers that don’t offer health coverage to full-time contingent faculty members and their dependents. However, the fact that there could potentially be a penalty if an employer fails to offer coverage doesn’t mean that there will be. Several criteria would need to be met before there could be any penalty. In addition, regulators created a buffer for large employers that fail to offer coverage to some of their employees without facing the offer-related penalty. Before they postponed the employer penalty, regulators had also said that plans operating on a fiscal-year basis wouldn’t even face possible penalties until the first plan year starting in 2014; given the postponement, however, we don’t yet know whether there will be a similar transition rule for fiscal year plans in 2015.

Q11: What is the buffer for failing to offer coverage to full-time employees and their dependents?
A11: Regulators have said that in order to meet the ACA’s standards related to offering coverage to full-time employees and their dependents, employers don’t have to offer coverage to absolutely all of them. Instead, they have said that employers could fail to offer coverage to 5 percent of their full-time employees and dependents. Large employers with fewer than 100 full-time employees could fail to offer to as many as five.

Q12: If penalties aren’t always certain when large employers fail to offer coverage to their full-timers and their dependents, under what circumstances are penalties going to be levied?
A12: For there to be any penalty under the provisions related to the offer of coverage, at least one full-time employee will have to be receiving federal premium tax credits for exchange-based insurance.

Q13: Could there be penalties for reasons other than a large employer’s failure to offer coverage?
A13: Yes. If a large employer offers coverage that is unaffordable or requires too much in the way of deductibles, copayments, and other cost-sharing, the employer could face a financial penalty. For there to be a penalty, the employee would have to be receiving federal premium tax credits for exchange-based coverage. Keep in mind, though, that regulators have created three employer affordability safe harbors so that even if employees get tax credits, there may be no penalties. There could also be a penalty if the employer meets the law’s standard related to offering coverage but still fails to offer coverage to 5 percent of its full-time employees and dependents (or, for large employers with fewer than 100 full-time employees, fails to offer to as many as five). In that case, if that employee gets premium tax credits, the employer will be penalized based on that employee. No full-time employee could lead to a penalty for any of these reasons if the employee wasn’t receiving premium tax credits for exchange-based coverage.

Q14: From a practical perspective, what does the postponement of penalties for large employers mean for contingent faculty members?
A14: First and foremost, it means that there’s no need to rush to make decisions about contingent faculty members’ hours or course loads. Some employers thought they needed to make quick decisions about cutting hours or course loads because of the penalty provisions of the law. You now have more time to identify and develop practical approaches to the ACA’s employer penalty provisions that are good for students, good for employees, and good for the institution.

Q15: What do we do if changes that hurt contingent faculty members have already been made?
A15: Your strategy should take several things into account. First, try to undo whatever negative decisions were made, given that whatever justification may have been used to make them—whether reasonable or not—is no longer valid in the short term. But don’t stop there. Make sure you use the opportunity created by the postponement to educate college or university officials and other stakeholders about what the law and regulations actually say about possible employer penalties. There very well may be perfectly workable solutions that don’t hurt members and don’t hurt students—but it may take some detailed work to get there. And don’t forget that this doesn’t have to be a defensive discussion about contingent faculty members’ hours or course loads: Think through what it would take to get quality, affordable coverage for members who are currently without it.

Q16: What do we do if the employer has not made any changes to employee hours or course loads?
A16: It depends. If your employer has not made changes to members’ hours and has not signaled that changes will need to be made, it’s possible that the employer doesn’t want to go in that direction. You have no need to instigate a conversation about members’ hours. Of course, it is still a good idea to be prepared for the discussion if it comes up.
If your employer hasn’t made changes to members’ hours but has said that changes will have to be made in the future, use the postponement of the ACA’s employer penalty provisions as an opportunity to educate school officials and other stakeholders about what the law and employer penalty regulations say on this topic. Push for reasonable solutions that work for members, students, and the institution. Use the time created by the postponement to move discussions about hours and course loads in a positive direction. Although you will need to be prepared to talk about hours and course loads, don’t forget to consider what it would take to get quality, affordable coverage for members currently without it.

Q17: How will someone qualify for premium tax credits?
A17: To be eligible for tax credits, someone has to be getting coverage through a health insurance exchange and have household income between 100 percent and 400 percent of the federal poverty level (for 2013, the annual income for a single person at 100-400% of the FPL would be $11,490-$45,960; for a family of 4 it would be $23,550-$94,200)5 but there are other criteria. The individual can’t be eligible for coverage under someone else’s affordable employer-sponsored plan, Medicaid, or other government coverage, for example. Illinois’ Medicaid program, the state-federal insurance program for the poor or disabled, is being expanded to cover individuals who earn up to 138 percent of the federal poverty level, or about $15,860. The federal tax credits will help defray the cost of buying insurance, depending on household income. An Illinois site is in production now and should be up and running by October 1st. About 200,000 Illinoisans are expected to sign up in the first year for such coverage.1

Q18: When will the ACA take effect?
A18: January 1, 2014 is the date that the ACA will be in effect. The health exchanges will begin to enroll people for it starting October 1, 2013. This is not a hard deadline; for coverage to start on January 1, 2014, individuals should sign up no later than December 15, 2013. 1

1. From The Chicago Tribune, 9/6/13, pp. 1& 12.
2. For further information, please visit the NEA website at http://www.nea.org. See the NEA’s July 31, 2013 Frequently Asked Questions about Contingent Faculty Members and the ACA’s Employer Penalty Provisions.
3. For further information, please visit the IEA website at http://www.ieanea.org/media/2013/04/FAQs-about-Contingent-Faculty-and-the-ACA-Employer-Penalty-March-26-2013.pdf.
4. Kaiser Family Foundation website: http://kff.org/health-reform/. Also see the U.S. Department of Health and Human Services’ website: http://www.hhs.gov/healthcare/.
5. http://www.familiesusa.org/resources/tools-for-advocates/guides/federal-poverty-guidelines.html

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