Editor’s note: Second in a two-part series.
According to Anne Sperling, president and CEO of Vanguard Resources, Inc., one goal of the Affordable Care Act (ACA) – eliminating discrimination based on factors such as preexisting health conditions and gender – has one glaring flaw.
Age discrimination is built into the premium structure, and it impacts both individuals and small businesses. That impact will only get worse if the so-called “Cadillac tax” goes into effect in 2020.
Sperling pointed to the premium for a Blue Cross/Blue Shield bronze plan with a $6,000 deductible and a maximum out-of-pocket expense of $7,150. The premium for a 59-year-old is $820 a month. A 21-year-old pays $200 a month.
Needless to say, the impact on individuals is tremendous. But small employers – defined as one to 50 employees in New Mexico and up to 100 employees in other states – also feel both the financial and administrative burden of those rates.
Large employers receive composite rates, in which the age of the population is averaged. Rates for small employers are based on the age of each individual in the organization.