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Does anyone have a good write-up of what a temporary agency needs to be concerned with in order to comply with ACA? ACA seems to impact them in a wholly unusual manner. Have the "big boys" (Manpower, Kelly) come out with anything about what their intentions are?

Austin Powers, CPA, QPA, ERPA

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I don't have any written materials, but PPACA is akin to a steamroller heading towards any staffing company.

The chacne of finding a traditional major medical plan is almost nil. If you consider the type of risk (high turnover, lower wages,) it is difficult to project costs, which leads carriers to just say no. Most of these staffing companies could not meet the participation requirements anyway. Self-funded is not a solution either. If they do decide to develop a benefits plan they need to proceed with caution and get good advice. There are ways to do this, but it will still be costly and will not be a major medical type plan.

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I wonder if the general consensus will be to pay the penalty?

I don't know. As the law is written now, there appears to be an opportunity to structure a version of a "mini-med" that will satisfy the requirements. My guess is that the cost will be somewhere around the penalty cost, allowing the temp agency to offer something. But I am not in that world, I do traditional employer coverage in the self-funded world.

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Mini meds are generic term that refers to plans that have limited benefits, such as a cap of $25,000. These plans have been very popular in certain industries that wanted to offer benefits, but needed low cost, such as restaurants.

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Is there a veru good technical wrtite-up anywhere of those counting methods and the calculation of the penalty amount? For a staffing agency, the details are critical. Everyrhing I've seen is very broad.

Austin Powers, CPA, QPA, ERPA

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Staffing agencies aren't going to be affected THAT much. They have the variable employee counting methods they can use and a 60% plan isn't that expensive.

With all due respect, I believe your comment to be incorrect.

Yes, there are a few ways of counting employees, and yes a possible plan design for them (60%) could very well be in the mid-$200 per month range. The reality is that there are very few, if any, of these types of organizations that will not reach the 50+ level. So it is safe to say that most, if not all of these organizations will be subject to PPACA.

While the price point of $250 or so does not sound like much, you need to consider it within the context of the cost to the staffing company. The first issue will be how to maintain the required participation level (75% in most instances) that the carrier will require. This is usually done via the employer contribution. A good rule of thumb is that the employer portion will need to be around 75% of the cost (not what is required by the carrier, but what is needed to achieve and maintain the participation requirement), or roughly $200-225 per person. The second issue is that of the value of providing that level of contribution ($200-225 per month) with respect to the total compensation paid. For a staffing company that specializes in higher income (IT for example, that might be paying $60k-70k per year) the cost is relatively low and makes sense. But for the majority of staffing firms that specialize in lower income ( $15 per hour or $450 per week) the contribution cost is a much higher pecentage cost of compensation.

I am not saying that these organizations can't find a solution, in fact I state there are solutions. It is just that finding the right combination of plan/costs with the right type of staffing (compensation paid, size, etc) will make this market very tough. Just take a look at Massachusettes, which has a similar health care requirement that PPACA is now requiring. Very few (if any) of those staffing companies kept health plans and

opted to pay the penalty.

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It all depends. With the right consultant (i.e me), staffing agencies will be able to thrive vs the competition. The one's I work with are low wage, and as of now, the ACA shouldn't hurt them too much. The penalty is not an option for most staffing agencies IMO.

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It all depends. With the right consultant (i.e me), staffing agencies will be able to thrive vs the competition. The one's I work with are low wage, and as of now, the ACA shouldn't hurt them too much. The penalty is not an option for most staffing agencies IMO.

If you read my first post I do state that it is not impossible, just difficult.

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