1. This Stuff is Complicated!

2. The number one question being asked by business today…
Is my company best served by keeping our health plan in tact…or… is the best choice to drop the plan and allow employees to buy Obamacare?

3. This stuff is complicated, there is no easy answer.
2,400 pages of legislation
19,000 pages of regulations
The Benefit Plan Alternatives ACA Decision Tool:
Considers 32 factors
Makes over 60 calculations and comparisons for each employee in a group
Objective: drill down to a single number, which provides a path forward for each Client

4. In Obamacare, premium doesn’t matter...huh?
Earning $20,000 per year
Earning $30,000 per year
Employee only:
$999 per year
Employee and Spouse:
$400 per year
Emply, Spouse, and 3 Children:
$0 per year
Employee only:
$2,480 per year
Employee and Spouse:
$1,762 per year
Emply, Spouse, and 3 Children:
$600 per year
The premium could be $1,000,000, Obamacare pays the difference
The “Premium” of Obamacare doesn’t matter for many of your employees

5. The premium doesn’t matter, but taxes do…
Today, premiums are paid with Pre-tax dollars
Obamacare is paid Post-tax
Pre-tax vs Post-tax at a 28% marginal tax rate:
Gross Earnings
$174.36
Less 28% Federal Income tax
$48.82
Less 7.65% FICA and Medicare
$13.34
Less 5% State Income Tax
$8.72
Less 2% City or School Tax
$3.48
Post-Tax Earnings
$100.00
Pre-tax Amount
Post-tax Amount
The Obamacare costs and subsidies need to be evaluated with this major difference in mind

6. Three Companies Compared
Drop the Plan Funding
ABC Co.
DEF Co.
GHI Co.
Today's Insurance Costs
$623,000
Drop The Plan…Employees are on their own
Obamacare $2,000 Penalty
$206,000
Employee Additional Cost of Obamacare
$445,000
$227,000
$395,000
Overall Cost to Drop the Plan
$651,000
$433,000
$604,000
Drop the Plan Savings (Loss)
-$28,000
$210,000
$19,000
Percentage Savings to Drop the Plan
-4.5%
33.7% 3%
97 employees, 69 covered by Heath Plan, 35% marginal tax rate, different levels of income

7. Cost of Neutral Funding
ABC Co.
DEF Co.
GHI Co.
Today's Insurance Costs
$623,000
Cost Neutral for those Hurt by
Dropping Plan:
Obamacare $2,000 Penalty
$206,000
Payroll expense to Gross up Employees
$545,000
$316,000
$489,000
Overall cost to Implement "Cost Neutral"
$751,000
$522,000
$695,000
Cost Neutral Savings (Loss)
($128,000)
$101,000
($72,000)
Cost Neutral Savings Percentage
-20.50%
16.20%
-11.60%

8. What Happens If… ABC Co. DEF Co. GHI Co.
What happens if employees helped by Obamacare use it, but those hurt by it remain in the employer plan?
ABC Co.
DEF Co.
GHI Co.
Number of employees helped by the Obamacare Exchange 21 31
Premium saved moving helped employees to the Exchange
$187,000
$286,000
$199,000
Penalty incurred to move employees to Exchange
$96,000
$143,000
$103,000
Saving realized by moving employees to Exchange
$91,000
Percentage of Premium Saved
14.6%
23.0%
16.5%

9. Can your company profit with Obamacare?