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Making the Exchange Work for Employers

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On January 10, I posted a discussion of why the exchanges as created by the House and Senate bills are unlikely to work for employers.

These problems could be fixed by:
1) Allowing the exchanges to calculate the employer’s share of the premium for providing the actuarial value level of insurance coverage and percentage of contribution determined by the employer (equal to or above the minimal required contribution level), to combine the premiums for all employees, and to composite bill the employer for the employer’s share, passing the payment for each employee through to the insurer chosen by that employee, and
2) Providing in the law that payments made voluntarily by an employer (who could also purchase a small group plan directly) to the exchange and passed on directly to a private insurer would not be considered revenues or expenditures of the federal government (and should not be scored by the CBO as revenues or expenditures).

The employer’s contribution would be the same percentage of every employee’s premium for whatever actuarial value of plan the employer chose, thus this approach would comply with the ADEA. The employee would remain liable for the remaining share of the premium.

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