Thursday, August 29, 2013

Local and state goverments cut part-time hours to avoid health coverage requirement

"Many cash-strapped cities and counties facing the prospect of shelling out hundreds of thousands of dollars in new health-care costs under the Affordable Care Act are opting instead to reduce the number of hours their part-time employees work," Reid Wilson reports for The Washington Post. "The decisions to cut employee hours come 16 months before employers — including state and local governments — will be required to offer health-care coverage to employees who work at least 30 hours a week." Some cuts are being made now out of fear "that employees who work at least 30 hours in the months leading up to the January 2015 implementation date would need to be included in their health-care plans."

Middletown Township, N.J.,  which spends about $9 million of its $65 million budget on employee health coverage, announced Tuesday "it would reduce the hours of 25 part-time workers to avoid up to $775,000 in increased annual health-care costs," Wilson reports. Anthony Mercantante, Middletown’s township administrator, told Wilson, “It’s not something we prefer to do, but the cost of health insurance is significant and would really impact municipal budgets. It’s not something we can take on, particularly when we don’t know some of the other ramifications of the Affordable Care Act. There are far more questions than answers right now.” (Read more)

Middleton isn't alone in making cuts. Bee County, a 32,000-population area just north of Corpus Christi, will be "capping the number of hours a part-time worker can work to 24 per week," starting with their fiscal year starting October, Andrew Ellison reports for KRIS 6 News in Coprus Christi. In Virginia the City of Lynchburg, "which has about 100 part-time employees, cut hours this year for about 35 to 40 people to keep them under the health insurance threshold," Eleanor Kennedy and Amy Trent report for The News and Advance. In Chippewa Falls, Wis., pop. 14,000, officials "announced they are dropping about 15 three-quarter time positions," Rich Kremer reports for Wisconsin Public Radio. Many other cities and counties have also announced cuts.

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