AT&T Will Record A $1 Billion Expense Related To Health Care Law

The AT&T write-down is the largest reported so far. Caterpillar this week recorded a $100 million charge in the first quarter and Deere & Co. said it will report a one-time $150 million expense.

Among its many changes, the new health-care law eliminated a tax deduction that companies used to cut the cost of drug-benefit programs for retired workers. President Obama signed the massive health-care overhaul into law earlier this week in a big victory for ruling Democrats.

The health reform bill eliminated a subsidy for companies that operated as a double deduction. Companies such as John Deere and Caterpillar will face new costs up to $150 million, Ellen Schultz reports.

Yet companies that still offer retiree drug benefits, mostly older industrial concerns or those with unionized employees, say the end of the deduction could force them to alter their benefit plans. In other words, they might curtail or even cancel them.

“As a result of this legislation, including the additional tax burden, AT&T will be evaluating prospective changes to the active and retiree health care benefits offered by the company,” AT&T said in a filing with the government on Friday.

An AT&T spokesman declined to comment further on the filing.

Earlier this week, Verizon Communications sent a letter to employees suggesting that changes to their health-care plans could be afoot. AT&T and Verizon are the two largest phone companies in the U.S. and include a substantial number of unionized workers.

Several million retirees are estimated to receive drug benefits from a few thousand companies. If those retirees were shifted to the federal Medicare program, the government would to pick up the expense. Whether savings from elimination of the subsidy would offset those higher Medicare costs is unclear.

Under the old law, companies received a federal subsidy worth up $1,330 per retiree if they provided former workers with drug-care benefits. At the same time, however, companies could deduct the value of the subsidy from their taxable income.

White House spokesman Robert Gibbs on Thursday said the government merely eliminated a tax loophole that effectively allowed a company to benefit twice from one law.

The AT&T announcement is sure to cause a ripple in Washington. Republicans have already assailed the administration for what they say are excessive costs saddled on business by the health-care law. The issue is sure to be part of their campaign against Democrats in the fall elections.

Democrats say the health-care law will become more popular over time and they point out that it also includes substantial new subsidies for business.

“There’s $10 billion in health-care reform for support for businesses with early retirees,” Gibbs said.

Jeffry Bartash is a reporter for MarketWatch in Washington.

The people we work with are saving an average of $2,208/year on their health insurance premiums without sacrificing benefits. You owe it to yourself to find out how a HSA can benefit you. Contact us today at 602-510-7507 or info@iqhsa.com. To receive quotes for individual/family health insurance in Arizona click here.

IQ Financial Group, llc. is a licensed insurance agency in the state of Arizona.  We offer a complete selection of health insurance, term life insurance, disability insurance, long term care insurance and supplement plans to individuals, families, self-employed and small businesses throughout Arizona.  We offer the best in Arizona Health Insurance.
© IQ Financial Group, llc.

Business Owner on Health Care: “I’m Confused”

Madelyn Alfano is no dummy. This native of Hoboken has spent the last 25 years building up a successful chain of restaurants in Los Angeles called Maria’s Italian Kitchen. She’s President of the LA chapter of the California Restaurant Association.

But ask her what she’s supposed to do next to expand healthcare coverage from 50 fulltime employees to all 400 of her workers, and she draws a blank. “I just read a 30-page summary of what the healthcare bill is supposed to do and mean,” she says. “And I read it again. I read it two times, I was so confused.” She knows that within four years she will need to provide coverage, but she has a lot of questions. For example, if she has a part-time waiter who works a second job at another restaurant, “Who pays for that?” She’s also concerned that she’ll be paying workers comp, sick days, general liability, AND healthcare. “Something’s gotta give.”

 The situation has her pausing expansion plans.

Alfano is just one of many business owners now trying to figure out what’s next. Here’s more of what she had to say.

 

 

The new healthcare law also mandates that any restaurant chain with at least 20 outlets must supply calorie information to customers. Alfano says that’s already the law in California, and the restaurant association supports this. But she’s worried she might get sued. Here she explains why:

 

 

Finally, the restaurant industry has been one of the hardest hit businesses in this recession. Madelyn Alfano explains how she managed to turn a profit and not lay off a single employee.

The people we work with are saving an average of $2,208/year on their health insurance premiums without sacrificing benefits. You owe it to yourself to find out how a HSA can benefit you. Contact us today at 602-510-7507 or info@iqhsa.com. To receive quotes for individual/family health insurance in Arizona click here.

IQ Financial Group, llc. is a licensed insurance agency in the state of Arizona.  We offer a complete selection of health insurance, term life insurance, disability insurance, long term care insurance and supplement plans to individuals, families, self-employed and small businesses throughout Arizona.  We offer the best in Arizona Health Insurance.
© IQ Financial Group, llc.

Health Savings Insurance Provides Access To The Uninsured

HSA health plans are playing a role to help provide access to the uninsured, promote preventive health services and show individuals and families where their hard-earned money is going in the health care system.

• HSA premiums have been growing at a slower rate than traditional insurance premiums.
• HSAs offer the advantage of portability – if you change jobs or your employment status changes, you keep the money in your HSA and continue using it to pay for your health care.
• Most HSA plans provide incentives for you to stay engaged in your overall health and well-being and almost all HSA plans offer first-dollar coverage for preventive services.
• HSA health plans play a vital role in providing health care coverage to millions of Americans who might otherwise be uninsured. A study by America’s Health Insurance Plans found that 27 percent of those buying HSA health plans in the individual market previously did not have health insurance.
• Health savings accounts encourage individuals to take a more active role in determining how they receive health care by choosing how to spend their health care dollars. When health care decisions are made by patients based on quality, effectiveness, and cost, money is being spent more efficiently.

 The people we work with are saving an average of $2,208/year on their health insurance premiums without sacrificing benefits. You owe it to yourself to find out how a HSA can benefit you. Contact us today at 602-510-7507 or info@iqhsa.com

IQ Financial Group, llc. is a licensed insurance agency in the state of Arizona.  We offer a complete selection of health insurance, term life insurance, disability insurance, long term care insurance and supplement plans to individuals, families, self-employed and small businesses throughout Arizona.  We offer the best in Arizona Health Insurance.
© IQ Financial Group, llc.