GOP: Felons Could Be 'Navigators' Under ObamaCare

A program designed to help people enroll in ObamaCare could accept convicted felons as "navigators" and give them access to confidential health information, GOP lawmakers charged Thursday.

Republican senators redoubled their attacks on the "navigator" program in a letter to Health and Human Services Secretary Kathleen Sebelius, arguing the effort is dangerous to consumers and a waste of taxpayer money.

The lawmakers also demanded a long list of details on the program, including the minimum requirements for becoming a "navigator" and any training materials distributed to would-be participants. 

They also asked whether "navigators" will have access to confidential tax documents and what steps the Obama administration has taken to protect consumers against potential fraud.

"The unreasonably low standard for becoming a navigator not only undermines the state’s ability to ensure consumers are protected but raises questions about the appropriate use of federal resources and the protection of highly sensitive consumer information," the lawmakers wrote.

Under the Affordable Care Act, "navigators" will help consumers understand their coverage options in the new insurance exchanges.

Some of the counselors are required to be affiliated with nonprofit groups, but none has to be licensed as an insurance agent or broker.

"Navigators" are not permitted to select a plan for their clients and do not determine individuals' eligibility for federal subsidies.

Supporters say the program is necessary to help underserved communities gain access to ObamaCare coverage.

The Health and Human Services Department has set aside $54 million for the effort and says any participants will have to demonstrate expertise in health insurance and take a 20-30 hour online course on ObamaCare.

Thursday's letter was signed by Senate Finance Committee ranking member Orrin Hatch (R-Utah) and Sens. Johnny Isakson (R-Ga.), Tom Coburn (R-Okla.), John Barrasso (R-Wyo.), Pat Roberts (R-Kan.), Mike Enzi (R-Wyo.), Richard Burr (R-N.C.), John Thune (R-S.D.) and John Cornyn (R-Texas).

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Health Perks Geared To Top Workers Could Trigger Penalties Under Health Law

Many executives have long enjoyed perks like free health care and better health benefits for themselves and their families. But under a little noticed anti-discrimination provision in the federal health law, such advantages could soon trigger fines of up to $500,000.

Employers “should be more concerned about this than anything else” in the law, because many are in violation and the penalties can be stiff, says Jay Starkman, chief executive of Engage PEO in St. Petersburg, Fla., which offers human resources services and advises clients on the health law.

The provision says that employers who offer more generous benefits to highly paid workers could face fines of $100 a day for every worker who doesn’t get the perks, up to $500,000.

It applies to employers who buy benefit packages for their firms from insurers. Those who self-fund their coverage, who tend to be larger firms, already face similar restrictions under Internal Revenue Service rules which pre-date the law.

To make sure his own small company complies with the law, Starkman began paying $600 in premiums toward his family’s coverage last month, putting him on an even playing field with his 60 employees.

He says the rule makes sense, noting that executives are likely to get little sympathy from the public.

“The right way to handle it is to have the same benefits for everyone,” he says, noting that firms can increase wages to managers or executives to cover their additional costs.

But business owner Steve Diddams worries that complying with the provision could erase his profits.

Diddams, owner of seven Diddams Party & Toy retail stores in California, has about 100 employees, most of whom are paid hourly and who don’t get health insurance.  But because he offers about 20 managerial workers HMO coverage, he might fall afoul of the discrimination rule. He could also be subject to a $2,000 per worker penalty for not offering coverage to his hourly employees, although lawyers say they’re not sure he would face fines for both.

Raising his prices to cover the cost of expanded health coverage really isn’t an option. “Our customers are moms with kids, and it comes to a point where they are not going to pay $2 for a balloon,” Diddams says.

The anti-discrimination provision is technically in effect now, but the IRS says it will not impose penalties until it completes regulations and issues guidance about how the provision will be enforced. 

Employers are likely to have until 2015 to figure out whether they comply, says Terry Dailey, a partner at Mercer, a benefit consulting firm.

The IRS rule offers guidelines explaining who is a highly paid employee, and says a plan discriminates if it favors such workers in terms of eligibility or benefits.

There are differences between the IRS rule and the federal health law provision. For example, if a self-insured firm is found to violate the IRS rule, the employees getting more generous benefits could end up paying taxes on their value. In contrast, the federal health law imposes fines on the employer, most of whom are expected to be small and mid-sized firms.

Congress likely saw the provision as “an additional deterrent to [employers] picking and choosing” who gets health coverage,” says attorney Timothy Tornga, of Mika Meyers Beckett & Jones in Grand Rapids, Mich., who advises employers.

Those penalties “fall especially hard on the small business population,” and may encourage some small firms to switch to self-funding their medical coverage, says the Small Business Coalition for Affordable Healthcare, which represents firms involved in agriculture, food service and retail, in comments submitted to the IRS.

In seeking comments, the IRS asked employers and others how to define “benefits.” Do they include, for example, not just the coverage provided, but how much employees pay toward those costs? Some firms, for example, charge executives less than other employees – or nothing at all – toward coverage. Would that count as being discriminatory?

Some groups don’t think so, and are urging the IRS to exclude the employee contributions from its calculations. Benefits are “limited to only those goods and services that are payable by the plan,” says the American Benefits Council, a trade association for employers.

The U.S. Chamber of Commerce, saying the older IRS rules that the federal law builds upon are unclear, rarely enforced and “unworkable,” wants the agency to replace them entirely rather than issuing rules “similar” to them.

Mercer’s Dailey says there are no good national statistics on how many employer plans might be considered discriminatory under the law.

Any fully insured plan that existed before the health law, and which has not been significantly changed is “grandfathered” and therefore exempt.

“We don’t see … [discriminatory policies] every day, but it’s not infrequent,” he says. “There will be many employers who will need to look at their plan designs and potentially make changes.

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McCaul: Overseas trip could hold key in search for attack motive

The chairman of the House Homeland Security Committee is pressing for more information about what happened to bombing suspect Tamerlan Tsarnaev during the six months after he reportedly boarded a Moscow-bound plane last year.

During televised interviews, Rep. Michael McCaul (R-Texas) said the trip could be an indication that Tsarnaev, 26, was trained and radicalized by Chechen rebels, who work “hand in glove” with al Qaeda in Pakistan.

“I'm very concerned he was out of the sights of the FBI, he went over to Chechnya and got trained and recruited and he came back and was successful in pulling off the largest terrorist operation since 9/11,” McCaul said on CNN Friday evening.

Tsarnaev, the elder of two brothers suspected in this week’s deadly Boston Marathon bombing, was killed following a firefight with police in the city’s Watertown section.

Watertown Police Chief Edward Deveau said on CNN Saturday that he was believed to be still alive when his younger brother, 19-year-old Dzhokhar Tsarnaev, drove over him in a stolen SUV while fleeing the scene. The younger Tsarnaev, captured late Friday after a tense standoff, had been shot and was in serious condition at an area hospital.

Authorities are keenly interested in questioning him about what precipitated the bombing and subsequent crime spree, which also claimed the life of a Massachusetts Institute of Technology campus security officer.

Yet McCaul, who had been briefed on the investigation, said late Friday night that the older brother was likely the key. He noted that Tamerlan Tsarnaev, who once said he dreamed of boxing for the United States in the Olympics, posted “radical jihadist” videos on YouTube upon his return to the United States.

He also said the devices used in the marathon bombing were similar to those used by al Qaeda, as were the explosive-laden “suicide vests” in the brothers’ possession.

“So, clearly, the question is how and when he got radicalized because he did. Where and when did that happen?” McCaul asked during an interview on Fox News. “I think it's very likely that it happened in the six-month period when he's over in a very dangerous part of the world.”

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Health Law Could Overwhelm Addiction Services

— Apr. 16 2:15 PM EDT  

In this March 11, 2013 photo, Michelle Adams, left, a case manager at the West Division Family Health Center in Chicago, speaks with Shavonne Bullock, a recovering heroin addict during an appointment. Bullock, who has been drug free since 2006 when she started treatment at the center, pays for her own treatment because she’s uninsured. Millions of Americans will gain insurance coverage for drug addiction and alcoholism treatment when the national health overhaul takes effect next year, and some experts predict the change will help thousands of people get clean and sober. (AP Photo/M. Spencer Green)

 

In this March 11, 2013 photo, Shavonne Bullock, a recovering heroin addict, holds a demonstration dose of the medication Suboxone during an appointment at the West Division Family Health Center in Chicago. Each dose is incorporated on a dissolvable film, which is placed below the tongue where is dissolves and is absorbed into the bloodstream. Suboxone helps suppress withdrawal symptoms and reduce cravings for people recovering from addiction to opioid drugs. (AP Photo/M. Spencer Green)

 

In this March 11, 2013 photo, Michelle Adams, left, a case manager at the West Division Family Health Center in Chicago, speaks with Shavonne Bullock, a recovering heroin addict during an appointment. Bullock, who has been drug free since 2006 when she started treatment at the center, pays for her own treatment because she’s uninsured. Millions of Americans will gain insurance coverage for drug addiction and alcoholism treatment when the national health overhaul takes effect next year, and some experts predict the change will help thousands of people get clean and sober. (AP Photo/M. Spencer Green)

 

In this March 11, 2013 photo, Shavonne Bullock, a recovering heroin addict, smiles during an appointment at the West Division Family Health Center in Chicago. Bullock, who has been drug free since 2006 when she started treatment at the center, pays for her own treatment because she’s uninsured. Millions of Americans will gain insurance coverage for drug addiction and alcoholism treatment when the national health overhaul takes effect next year, and some experts predict the change will help thousands of people get clean and sober. (AP Photo/M. Spencer Green)

 

This April 2, 3013 photo shows the detox waiting room at Haymarket Center in Chicago. These men are waiting for a bed in the addiction treatment facility. (AP Photo/M. Spencer Green)

CHICAGO (AP) — It has been six decades since doctors concluded that addiction was a disease that could be treated, but today the condition still dwells on the fringes of the medical community. Only 1 cent of every health care dollar in the United States goes toward addiction, and few alcoholics and drug addicts receive treatment. One huge barrier, according to many experts, has been a lack of health insurance.

But that barrier crumbles in less than a year. In a major break with the past, 3 million to 5 million people with drug and alcohol problems — from homeless drug addicts to working moms who drink too much — suddenly will become eligible for insurance coverage under the new health care overhaul.

The number of people seeking treatment could double over current levels, depending on how many states decide to expand their Medicaid programs and how many addicts choose to take advantage of the new opportunity, according to an Associated Press analysis of government data. The analysis compared federal data on the addiction rates in the 50 states, the capacity of treatment programs and the provisions of the new health law.

The surge in patients is expected to push a marginal part of the health care system out of church basements and into the mainstream of medical care. Already, the prospect of more paying patients has prompted private equity firms to increase their investments in addiction treatment companies, according to a market research firm. And families fighting the affliction are beginning to consider a new avenue for help.

"There is no illness currently being treated that will be more affected by the Affordable Care Act than addiction," said Tom McLellan, CEO of the nonprofit Treatment Research Institute and President Barack Obama's former deputy drug czar. "That's because we have a system of treatment that was built for a time when they didn't understand that addiction was an illness."

But those eager for a new chance at sobriety may be surprised by the reality behind the promise. The system for treating substance abuse — now largely publicly funded and run by counselors with limited medical training — is small and already full to overflowing in many places. In more than two-thirds of the states, treatment clinics are already at or approaching 100 percent capacity.

The new demand could swamp the system before even half of the newly insured show up at the door, causing waiting lists of months or longer, treatment agencies say. In recent years, many rehab centers have been shrinking rather than growing because of government budget cuts for patients who receive public support.

"Advocates just get so excited, but at some point, reality is going to hit and they'll find it's not all it was cracked up to be," said Josh Archambault of the Pioneer Institute, a nonpartisan public policy research center in Boston.

In the coming years, treatment programs and medical colleges will face pressure to ramp up to create a larger system.

But until then, addiction treatment may represent an extreme example of one of the Affordable Care Act's challenges: actually delivering the care that people are supposed to receive.

Many with substance problems are waiting eagerly for January, when the new insurance will become available.

"It's the chance to clean up and not use anymore, so I could live a stable life," said 30-year-old Ashley Lore of Portsmouth, Ohio, who was jailed and lost custody of her 4-year-old daughter as a result of her heroin addiction. "If I get into treatment, I get visitation to my daughter back. And I get her back after I complete treatment."

Only about 10 percent of the 23 million Americans with alcohol or drug problems now receive treatment, according to the National Survey on Drug Use and Health. Shame and stigma are part of the reason but about a quarter of them don't have insurance coverage. That compares with the overall uninsured rate of 16 percent.

With money for treatment limited, slots in rehabilitation centers and hospitals are scarce. In Minnesota, which has one of the higher substance abuse rates in the nation — 11.6 percent of the population — there are slightly more than 3,900 inpatient beds for the 491,000 people who need treatment, according to federal data. Occupancy is over 100 percent.

Insurance can mean the difference between getting a spot or waiting indefinitely for publicly subsidized help.

Michelle Hines, an Illinois mother, had both experiences when her 19-year-old son became part of a disturbing new trend: suburban teenagers hooked on heroin.

Because he was uninsured, the wait would stretch to a month or six weeks for a public bed. His parents, who own a small business, couldn't afford the $2,000-per-month injections to block the heroin high. Overall, outpatient programs cost about $10,000, and a residential treatment stay about $28,000.

Everything changed after her son was able to get coverage under the family's insurance plan because of an early benefit of the Affordable Care Act.

They now pay only $40 a month for the shot that helps him stay clean. "He's working hard at getting his life back together," Hines said. "He's in school full time; he's got a job." (Michelle Hines asked that her son's name be withheld to avoid hurting his future employment prospects.)

Nine alumni of Hines' son's high school have died from drug overdoses. "A waiting list for a heroin addict could mean death," Hines said. "So many have died waiting, it's awful."

Today, those without insurance include many lower- and middle-income people who don't get the benefit from an employer — businesses provide coverage for about 50 percent of Americans — don't qualify for Medicaid or Medicare and can't afford their own policies.

The new law would provide subsidies to help many buy private coverage. The government is also pressing states to expand their Medicaid programs to include more working poor people. If 20 states expand their Medicaid programs — roughly the number now planning to do so — an additional 3.8 million prospective patients with addiction problems would get insurance, according to the AP analysis. If virtually all of the states eventually decide to expand, as federal officials predict, the ranks of the newly insured with addiction problems could reach 5.5 million.

Perhaps as important as the expansion, the new law designates addiction treatment as an "essential health benefit" for most commercial plans.

"This is probably the most profound change we've had in drug policy ever," said Michael Botticelli, deputy director of the Office of National Drug Control Policy. "We know one of the most significant reasons for the treatment gap is folks who don't have insurance or who have an inadequate coverage package for substance use disorders."

But will those who suddenly get coverage for treatment have a place to get it?

Haymarket Center in Chicago illustrates what may await many addicts. One Friday morning, seven men slumped in chairs in a small, bare room with only an untouched rack of health brochures to break the monotony of waiting for the chance of a detox bed that night. The six-story brick building is a beehive of programs for 300-plus patients: short term detox, long-term residential treatment, recovery units where people can live sober while looking for work. Everything is overbooked. On this day, the waiting list totaled 91 people who want help.

"Last year the state cut our dollars so we had to cut back our beds," said Dan Lustig, vice president of Haymarket, which gets most of its funding from the government. "We had clients literally pleading for services. Some were sleeping on our front steps."

In Illinois, where 92,000 people get treatment now, nearly 235,000 addicts and alcoholics without insurance will be able to get coverage next year. Not only beds are lacking. The pool of physicians who are addiction specialists must grow by 3,000 nationwide, almost double what it is now, to handle the demand, according to health industry experts.

"The big question for providers is how do we bridge the gap between now and then?" said Bruce Angleman of Heritage Behavioral Health Center, which provides treatment in Decatur, in central Illinois.

There are also questions about how comprehensive and affordable the new coverage will be. Consumers or their employers who choose cheaper policies with high out-of-pocket costs may find themselves unable to afford their share of an expensive program.

The future ideal may end up looking something like the care Shavonne Bullock receives in a neighborhood clinic in Chicago, the metro area with the highest rate of heroin-related emergency room visits. Seven years into her recovery, Bullock, a 54-year-old former heroin addict, still gets counseling and takes medication— "my blessing" she calls it — at the Access Community Health Network clinic to suppress withdrawal symptoms and reduce craving.

Her doctors and counselors work together. They recognize that addiction is a chronic condition, like diabetes, that needs maintenance.

"I haven't thought about drugs in seven years," she said. Treatment, she said, "works if you work it. It's all up to the individual. And it really works."

___

AP Medical Writer Carla K. Johnson can be reached at http://www.twitter.com/CarlaKJohnson

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Insurance Tax In Healthcare Law Could Cost States $15B

Groups on both sides of the healthcare debate are lobbying Congress to scale back a tax in President Obama's healthcare law that could end up costing the states billions of dollars.

Supporters and opponents of the healthcare law are both eyeing changes to the law's tax on insurance plans, which could cost the states nearly $15 billion.

The Affordable Care Act includes a new excise tax on insurance plans, and the tax applies to the privately managed Medicaid programs many states use. Taxing Medicaid managed care plans could force state governments to pay the tax.

The Republican Governors Association (RGA) raised the issue in a recent letter to congressional leaders, saying the tax "merits your urgent attention."

A report from the Milliman consulting firm estimated that the tax would cost state governments between $13 billion and $15 billion over the next decade.

Insurance companies have lobbied for years to repeal the insurance tax altogether, saying it will raise premiums across the board. The fee was included to help pay for the cost of expanding insurance coverage.

But RGA Chairman Bobby Jindal (R-La.) and Vice Chairman Scott Walker (R-Wis.) opened the door to a narrower option in their letter to lawmakers, asking only for Congress to exempt Medicaid and the Children's Health Insurance Plan from the tax.

"As Congress considers deficit reduction and tax reform, we urge you to amend (the Affordable Care Act) to exempt all Medicaid and CHIP premium revenue from this fee," they wrote.

Some of the law's supporters are also on board. The National Urban League is trying to build support for an exemption among other groups that support the health law's Medicaid expansion.

States that realize they'll bear new taxes on their Medicaid plans might be less inclined to expand the program, the Urban League said.

"We recognize that revenue mechanisms, including fees, are critical to achieve the savings that the ACA aims to accomplish," the group wrote in a letter to the National Council of La Raza. "However, due to the possibility that the fee may restrict the ability of states to expand their Medicaid programs through insurers that provide Medicaid and CHIP coverage, we believe that an exemption for these plans should be considered."

At least for now, the lobbying push around the health insurance tax remains focused mostly on full repeal. Joe Moser, director of government affairs for the Medicaid Health Plans of America, said his organization is not lobbying for an exemption, but rather is still focused on full repeal.

A narrower exemption could also be a hard sell for large insurance carriers. The insurance tax is structured as a flat fee — it has to raise a certain amount each year — so carving out Medicaid managed care plans would raise the tax burden for other insurance plans.

Nevertheless, Democrats have shown an increasing willingness to modify the healthcare law now that its basic survival has been assured. 

A non-binding measure to repeal the law's tax on medical devices won overwhelming bipartisan support in the Senate last month, and the White House has agreed to cut funding for certain programs as part of various spending and deficit-reduction bills.

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Obamacare Credits Could Trigger Surprise Tax Bills

WASHINGTON (AP) -- Millions of people who take advantage of government subsidies to help buy health insurance next year could get stung by surprise tax bills if they don't accurately project their income.

President Barack Obama's new health care law will offer subsidies to help people buy private health insurance on state-based exchanges, if they don't already get coverage through their employers. The subsidies are based on income. The lower your income, the bigger the subsidy.

But the government doesn't know how much money you're going to make next year. And when you apply for the subsidy, this fall, it won't even know how much you're making this year. So, unless you tell the government otherwise, it will rely on the best information it has: your 2012 tax return, filed this spring.

What happens if you or your spouse gets a raise and your family income goes up in 2014? You could end up with a bigger subsidy than you are entitled to. If that happens, the law says you have to pay back at least part of the money when you file your tax return in the spring of 2015.

That could result in smaller tax refunds or surprise tax bills for millions of middle-income families.

"That's scary," says Joan Baird of Springfield, Va. "I had no idea, and I work in health care."

Baird, a health care information management worker, is far from alone. Health care providers, advocates and tax experts say the vast majority of Americans know very little about the new health care law, let alone the kind of detailed information many will need to navigate its system of subsidies and penalties.

"They know it's out there," said Mark Cummings, who manages the H&R Block office where Baird was getting her own taxes done. "But in general, they don't know anything about it."

A draft of the application for insurance asks people to project their 2014 income if their current income is not steady or if they expect it to change. The application runs 15 pages for a three-person family, but nowhere does it warn people that they may have to repay part of the subsidy if their income increases.

"I think this will be the hardest thing for members of the public to understand because it is a novel aspect of this tax credit," said Catherine Livingston, who recently served as health care counsel for the Internal Revenue Service. "I can't think of what else they do in the tax system currently that works that way." Livingston is now a partner in the Washington office of the law firm Jones Day.

There's another wrinkle: The vast majority of taxpayers won't actually receive the subsidies. Instead, the money will be paid directly to insurance companies and consumers will get the benefit in reduced premiums.

Health care providers and advocates for people who don't have insurance are planning public awareness campaigns to teach people about the health care law and its benefits.

Enroll America, a coalition of health care providers and advocates, is planning a multimillion-dollar campaign using social media, paid advertising and grass-roots organizing to encourage people who don't have insurance to sign up for it, said Anne Filipic, a former Obama White House official who is now president of the organization.

The Obama administration says it, too, is working to educate consumers.

"On Oct. 1, each state will have a marketplace up and running where consumers can choose a private health insurance plan that fits their health needs and budget," said Treasury spokeswoman Sabrina Siddiqui. "The premium tax credits will give middle-class Americans unprecedented tax benefits to make the purchase of health insurance affordable for everyone, and we will continue to work with consumers, community health organizations and other stakeholders to raise awareness and understanding of these tax benefits."

The subsidies, which are technically tax credits because they are administered through the tax code, will help low- and middle-income families buy health insurance through the state-based exchanges. Under the new law, nearly every American will be required to have health insurance starting in 2014, or face penalties.

The enrollment season starts Oct. 1.

The subsidies are available to families with incomes up to 400 percent of the poverty level. This year, four times the poverty level is about $62,000 for a two-person family. For a family of four, it's $94,200.

About 18 million people will be eligible for subsidies, according to the Congressional Budget Office.

If families get bigger subsidies than they are entitled to under the law, the amount they have to repay is capped, based on income and family size. If they get less than they qualify for under the law, the government will pay them the difference in the form of a tax refund.

There are also special rules that protect people who marry or divorce from being required to pay back subsidies just because their marital status changes.

There are four thresholds for repaying the subsidies:

—A family of four making less than $47,000 would have to repay a maximum of $600.

—If the same family makes between $47,000 and $70,000, the amount they have to repay is capped at $1,500.

—If the same family makes between $70,000 and $94,200, the amount is capped at $2,500.

—Families making more than four times the poverty level have to repay the entire subsidy.

"It's potentially going to come as a shock to individuals who meet that criteria where their income hits a point where they owe money back," said Rep. Charles Boustany, R-La., chairman of the House Ways and Means oversight subcommittee. "The fact is, with variations in income, people could end up owing money back and that will create consternation and problems for them."

The total amount of money that taxpayers will have to repay is unclear, but congressional estimates offer some clues.

Twice since the health care law was passed Congress has increased the caps for how much people will have to repay. Combined, the two measures are expected to raise more than $40 billion over the next decade, according to Congress' Joint Committee on Taxation.

"I think people will get there," said Livingston, the former IRS official. "They will develop instincts about it the way we all do about any process we go through multiple times. But when it's new, in the early years, this will be a real learning curve."

___

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Health Law Could Boost Use Of Temp Workers

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Health law could boost use of temp workers By Jay Hancock, Mar 25, 2013 10:40 PM EDT

The Washington Post

The health-care law could prove to be a boon for temporary-staffing companies as employers outsource jobs to sidestep complex requirements for medical insurance.

But some experts say the Affordable Care Act’s exceptions for temporary employees could undercut the goal of expanding coverage to more American workers.

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“That could lead to an increase in part-time workers” who lack insurance, said Susan N. Houseman, an economist at the Upjohn Institute for Employment Research who studies staffing companies. “You regulate something and people will always try to find a way around the regulation.”

Starting in January, employers with at least 50 workers must offer affordable coverage or pay a penalty. To stay under this limit, some are considering outsourcing jobs to specialists such as Kelly Services, Manpower, Robert Half and Randstad, whose stock prices have soared.

“We are already getting inquiries from our client base for companies in and around 50 [employees], asking us to help them understand this legislation, and to inquire as to how we might be helpful,” M. Keith Waddell, Robert Half’s president, told investors on a conference call a few weeks ago. “Our response is that we can legally help them remain under 50.”

The health law is also prompting larger organizations to use temp agencies. By requiring employer coverage only for those who put in at least 30 hours a week, the act appears to create an incentive for companies to do less with permanent workers and more with part-timers, which are the main focus of staffing agencies.

Manpower is talking to clients about “a more flexible labor model,” where workers “might be working 29 hours a week,” company chief executive Jeffrey A. Joerres told investors in January, adding, “We definitely look at it as a positive.”

School administrators in Dothan, Ala., decided to hire substitute teachers through Kelly Services to avoid possible health-cost obligations if they were to employ them directly.

Dothan subs don’t get medical coverage now, and the district pays about $700 per month for the full-time teachers who do. “You multiply that times 300 [substitutes] and you’ve got a big expense,” said Dell Goodwin, personnel director for Dothan City Schools.

Little-known, complex rules developed by the Internal Revenue Service could also allow some full-time jobs placed through temp agencies to come without health benefits.

Manpower, Robert Half and other staffing specialists are giant companies, with far more than 50 employees. So they are subject to the same health act requirements as other companies to offer coverage to full-timers.

But in regulations issued last year, the IRS left an opening for employers of “variable-hour” labor such as temp agencies. If it’s not clear upon hiring that an employee will consistently work more than 30 hours weekly, companies get up to 12 months to determine whether the person is full time and qualifies for health benefits — even if the employee does end up working full time. Few temps last 12 months.

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