Local Politics

Saturday, Jun 15 2013 09:00 PM

Health reform mandate may cost county millions more

BY JAMES BURGER Californian staff writer jburger@bakersfield.com

The county of Kern is stuck in an employee pickle with millions at stake and just six months to go before key provisions of the federal Affordable Care Act take effect on Jan. 1.

On Tuesday, Kern County supervisors will grapple with the impact of a portion of health care reform that requires employers to provide health insurance coverage for all full-time employees -- workers who spend more than 59 hours on the job each two-week pay period.

That includes about 7.7 percent of the county workforce -- some 690 of the county's 8,900 employees -- known as "extra-help" workers.

An extensive report from the Kern County Administrative Office lays out the basic problem:

Extra-help employees work variable hours -- though 586 of them work more than 30 hours a week -- for only nine months at a time.

They receive no health insurance benefits.

Now, under the Affordable Care Act's employer mandate, the county will need to provide health insurance to those employees at an annual cost of $8 million a year.

Or the county will need to remake its extra-help system -- most likely by slashing the number of hours an extra-help worker can work in a pay period or in a year.

Both options pose challenges.

Paying another $8 million would wreak havoc on a county budget already reeling from a $9 million reduction in property tax revenue.

But it would be cheaper than violating the Act, which county officials estimate would cost Kern County more than $17 million in fines.

Changing how extra help works could create stumbling blocks for county programs and force extra-help employees who struggle to live on nine months of employment each year to make tough decisions about whether they can work for the county.

Assistant County Administrative Officer Elissa Ladd said the county thought the obvious choice was to reduce hours for extra-help employees.

"We had originally proposed that all extra help go to three-quarters time," she said.

But county department heads made it clear that cutting hours would create major operational problems.

So it will be up to supervisors to provide some guidance. They could go with the status quo through the end of 2014, according to county reports, but that would only give the county a bit of breathing room while they create a final solution.

"For Tuesday there is no recommendation," Ladd said. "We need a discussion. There is still a lot of uncertainty in this implementation."

Kern County Parks and Recreation Director Bob Lerude has only 15 extra-help workers.

But he said cutting their hours enough to avoid violating the Affordable Care Act would create a big impact on some workers.

"They're going to have to get another job," he said.

That creates a scheduling conflict between that second job and the work that employee does for the parks department.

It also forces the parks department to either maintain its current complement of extra-help workers -- and get less done -- or hire a larger number of people for fewer hours and go through the bother and expense of training them.

It could also, Lerude said, prompt faster turnover of workers as people cycle into and out of jobs that can't give them full-time work.

And, he said, county departments will have to be vigilant about how many hours extra-help employees work.

An employee who puts in a little extra time to clean up a park -- rather than going back out to the facility the next day to finish up -- could create a violation of the Act and trigger the $17 million penalty on the county.

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