The cost of MSU’s health care plan will continuously increase throughout the next six years to meet the new requirements of the Affordable Care Act, or ACA.
At Tuesday afternoon’s University Council meeting, Renee Rivard, the director of benefits with MSU Human Resources, or HR, presented the impacts the ACA will have on MSU from 2012 through 2018. Increased health care costs will affect any employee who receives a W-2 form from MSU, she said.
The ACA also will affect any student who is on MSU’s health care plan.
According to HR, some of the definite 2012 and 2013 changes include increases to group health plan fees, while adding coverage of women’s preventative services, such as generic contraceptives.
Rivard said the total cost of ACA’s impact on MSU’s health care will not be known until HR deciphers what is certain for 2014 through 2018. According to HR, the cost should be finalized by late March.
Projected changes after 2014 include additional increased fees from various factors, such as individual insurance mandates and the movement of additional employees onto MSU’s health plan, and a 40 percent excise tax on high cost coverage, among various other changes.
Group health plan fees cost MSU approximately $30,000 in 2012 and are predicted to cost $60,000 in 2013, while women’s services will cost MSU $150,000-200,000 annually, according to HR. In 2013, the plan also will decrease what MSU gains from the FICA tax from $5,000 to $2,500. The FICA tax is a social security tax.
According to HR, MSU potentially could pay an additional $2.3 million to $6.1 million annually, increasing health care costs between 2 and 5 percent on a yearly basis, HR reported. These listed costs are the shared total amounts to MSU and its employees, Rivard said.
HR is working to mitigate these costs and ensure every employee is able to be covered, she said. As of now, there are not alterations to employee’s benefit packages, Rivard said.
“The cost of health care is going to increase by some amount depending on what you’re talking about,” Rivard said pointing at HR’s health plan spreadsheet. “As we move down this grid, (the cost is) going to continue to move in a negative way.”
Evan Martinak, president of ASMSU, MSU’s undergraduate government, said he does not know of the impact this will have on students, but ASMSU provides an online resource to help students find financially feasible insurance plans.
“A large majority of students are covered under their parents’ health care plan, which is great,” he said. “But there are still a pocket of students that aren’t.”
After the meeting, MSU President Lou Anna K. Simon said although the ACA aims to provide more health care coverage to individuals, it does not benefit a large institution, such as MSU.
“We’re going to be able to find some strategies that work within the (constraints) of the Affordable Care Act and provide insurance coverage for our employees,” Simon said. “I’m confident that the creativity of the university community will pull through.”
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