GREENFIELD — Congressman Luke Messer will file legislation this week that would exempt schools and colleges from the Affordable Care Act, saying the mandate to provide health insurance to part-time employees comes at too great of a cost.
The federal health care act, commonly referred to as Obamacare, requires large employers to provide health insurance to part-time employees who work 30 to 40 hours a week.
School administrators – along with business owners and local units of government – are now weighing whether to cut back their part-time employees’ hours so they’ll fall under the threshold established by the law.
Messer, a Republican freshman lawmaker from Shelbyville, whose district includes Hancock County, said schools in particular are feeling the crunch.
“I am hopeful that it could receive bipartisan support,” Messer said of the pending bill. “At a time when schools are strapped for cash, it doesn’t make any sense to add an additional requirement on the schools that could cost hundreds of thousands of dollars to each school corporation.”
At issue is a policy change made by the IRS in January. Schools are prohibited from taking summer break and other school holiday breaks into account when calculating their employees’ weekly hours. Therefore, a person who works 30 hours a week but only while school is in session is considered eligible for health insurance.
Eastern Hancock Superintendent Randy Harris said if that interpretation of the law was changed, it would help local schools. Last month, the EH board decided to reduce the hours of part-time food service and bus driver staff to avoid having to offer health insurance.
“You have to count a week they worked as a normal week, and assume they’ve worked it all year long,” Harris said. “Now, they’ve forced our hand to cut back hours. If you looked at it on a yearly basis and averaged it out a year, everything would have been OK.”
Other local school administrators are also grappling with the issue.
Local educational assistants for students with special needs will no longer be allowed to work more than 28 hours a week because of the new law. The Hancock Madison Shelby Educational Services board is now concerned about losing quality staff because of the cut.
Southern Hancock Assistant Superintendent Bob Yoder estimates it will cost the school district $340,000 to $450,000 to provide insurance for part-time employees, though he said the corporation hasn’t decided whether to cut their hours to get under the threshold of the Affordable Care Act.
Messer said the issue affects schools across the country, but Indiana schools were among the first to raise red flags.
Messer brought the issue to a meeting with Education Secretary Arne Duncan last week, and said his legislation should be filed this week to allow schools and colleges to be exempt of the health care act.
Messer said ultimately he would want the law to be repealed entirely, but if that’s not going to happen, something else should be done to provide relief.
Another idea, Messer said, is more of a regulatory fix that could be made by the IRS. If the IRS calculated school part-time hours to take into account lengthy breaks, the average weekly hours would be less. Thus, the schools wouldn’t have to provide insurance to part-time employees who work 30 to 40 hours a week while school is in session.
Messer’s not the only one concerned. All seven Republican congressmen from Indiana signed a letter last week to Secretary of the Treasury Jack Lew and Secretary of Health and Human Services Kathleen Sebelius. The letter asks the federal offices to provide projections on how the Affordable Care Act would impact school employees’ hours, and a complete list of hours and jobs that could be cut by the law.
“Educators should be focused on meeting the needs of students, not navigating the unintended consequences of federal regulations imposed by this new mandate,” the letter states.
The cutback in employees’ hours, the letter states, not only affects the educational level of students, but also burdens many Hoosiers who are depending on the jobs as a secondary source of income.
“Now we have a unique circumstance where the federal government is taxing local schools to provide health care, and I believe that’s wrong,” Messer said.