Tribes are employers - and there is a mandate

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By Mark Trahant
Special to News From Indian Country June 2010

We’re still confused about the new health care insurance law. But there is this twist: More of us are starting to figure out what the Patient Protection and Affordable Care Act means to our families.

The Kaiser Family Foundation reports in a May poll: “Confusion over the new health reform law declined but remains widespread, with 44 percent of the public saying they were confused in May, compared to 55 percent in April.

Moreover, more than a third of Americans (35%) say they do not understand what the impact of the law will be on themselves and their families, while 61 percent report feeling they do understand what that impact will be.”

It’s also interesting to see how we are learning about this new law.  “More than half report having gotten information from friends and family (68%), or from cable (63%) or broadcast news programs (55%). Further breaking down those getting health reform information from cable news, 25 percent of Americans indicated their main cable source on this topic was FOX News, 22 percent named CNN and 6 percent MSNBC.  In fact, cable news still tops the list of the public’s “most important” sources of news about the new law, with 30 percent saying they rely on that source more than any other.”

If cable news is teaching America about health care reform, well, let’s just say, there will be a lot more to learn later.

Of course the story in Indian Country is not exactly a topic on cable. It’s also practically a non-story in daily newspapers, on TV and radio news programs or even Internet news sites. This is too bad because the Indian Health Care Improvement Act is a significant part of the entire reform process; it’s now a package deal.

What’s more this lack of information means that Indian Country – tribes and individual citizens – will have a much more difficult time figuring out the impact of the law on our governments and our families. (My previous columns about effects ranging from job creation to Medicaid expansion are archived at www.marktrahant.com) Indeed, I suspect a poll of American Indians and Alaska Natives would find even more confusion than in the general society.

For example the law immediately “fixes” the problem that occurred when tribal governments purchased blanket health insurance for members. The IRS had taken the position that such a deal was a taxable event. But, as a U.S. House timeline describes the next steps, the tax code “ Excludes from gross income the value of specified Indian tribal health benefits. The provision is effective for benefits and coverage provided after the date of enactment.”

In other words tribes are free to supplement the Indian health system from their own resources.

But the big question – one that will need to wait for more specifics from the regulations – centers on how much health insurance will tribes be required to purchase for their full-time employees.

While individual American Indians are exempt from the insurance mandate, that provision does not apply to either tribal governments or reservation businesses. In general employers with more than 50 workers must offer insurance. To make it even more complicated: The insurance plan must be affordable – costing the employee less than 9.5 percent of their household income.

There is an important loophole here. The law applies to full time employers – so a company (or government) can reduce its health care costs by shifting its workforce to part-time status. This is something to watch closely going forward.

The law says large employers, including tribal governments, must offer health insurance that meets a minimum standard of care. How will that mesh with services in the Indian health system? We won’t know yet but the rules to implement this part of the law are being rushed using a process that skips some of the normal steps in agency rulemaking. It’s likely that some tribal plans and self-insurance programs, at least those in place before March 23 (the day the president signed the bill into law), will have some leeway.

But the pesky details are yet to be written. No wonder some of us remain confused.

Mark Trahant is a Kaiser Media Fellow examining the Indian Health Service and its relevance to the national health care reform debate. He is a member of Idaho’s Shoshone-Bannock Tribes. Comment at www.marktrahant.com

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