Agenda Date: 9/22/2015
Subject:
Title
Resolution authorizing a Cooperative Agreement with Littleton Housing Authority d/b/a South Metro Housing Options
Body
Presented By:
Erich WonSavage, HR Director
POLICY QUESTION:
Does city council support amending the agreement with South Metro Housing Options (SMHO)?
BACKGROUND:
The Patient Protection and Affordable Care Act (PPACA) was signed into law in 2010. It has been implemented in phases.
SMHO and the city have long operated as separate employers but have an agreement that specifies certain services which the city provides. Due to PPACA, the city will have great difficulty in continuing to manage health insurance for SMHO employees and will likely be unable to fulfill new reporting requirements, properly track eligibility and measurement periods, or correctly classify SMHO's employees under the mandate. Failure to comply with PPACA's requirements exposes the city and its health plan to numerous monetary penalties. Moreover, the Colorado Department of Regulatory Agencies, Division of Insurance requires multi-employer plans that are self-funded to operate under a trust. The city's medical plan is self-funded, and the city will be considered as operating as an unauthorized insurance company if it cannot show that its self-funded medical plan is administered through an acceptable multiple employer health trust.
STAFF ANALYSIS:
The city does not hire, terminate, classify, or administer payroll for SMHO, or manage its human resource information system. Being separate employers makes it nearly impossible to properly comply with PPACA requirements and avoid monetary penalties for non-compliance.
SMHO falls under PPACA's 50 employee threshold and does not need to comply with the Act's requirements. As a small employer, SMHO would be allowed to use the State's exchanges as its health plan, or find other private insurance, if it chose. The city staff and consultant are assisting SMHO in evaluat...
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