Benefits Selling expo speaker: Make sure to attend BrianRobertson's session, “When Worlds Collide,” May 19 at 1:30 p.m. inTrailblazer A.

It was October 2014 when a voluntary benefits broker, atraditional self-funding TPA and an IRS PPACA regulator walked intoa bar….

You might think it was chance, but a certain snarky editor of apopular benefits publication was already in the bar (yeah, I know,what a surprise). He was there to meet the voluntary broker, whohad brought along the TPA, his new best friend. The bar owner, whohas 33 locations in five states, is a client of the benefitsbroker. He has more than 600 employees and although the company hasnever offered qualifying medical coverage to its hourly employees,it has offered a limited medical plan in the past. With PPACAmandates and deadlines breathing down his neck, the bar owner wastrying to understand his options.

The bar owner is worried about penalties. He knows he can'tafford the cost of affordable qualified care for his employees andhe's looking to his benefits broker to deliver a solution. Thebenefits broker has been scouring the marketplace for the last sixmonths and has come up with minimum essential coverage as asolution. The broker brought in his new best friend, a TPA, toexplain self-funding and how an MEC plan operates.

The bar owner understands the basics of the MEC plan and iswilling to assume a new level of risk to avoid the penalty. But,the broker explains, the MEC plan only satisfies one of the twopenalties of section 4890(H). Because he wouldn't be offeringaffordable qualifying coverage, the bar owner will pay a penalty ifan employee doesn't enroll in the MEC, but instead goes to anexchange to purchase coverage and receives a subsidy. The barowner, wringing his hands, says he really wants to avoid allpenalties.

The TPA begins to talk about an attorney who has found a minimumvalue calculator on the CMS website allowing for creation of aminimum value plan that excludes hospitalization. In this scenario,a self-funded plan may be used that provides the bar owner withmedical coverage that satisfies the employer mandate and doesn'trun the risk of a penalty.

“But what about hospitalization?” the editor pipes in.

Ignoring him, the benefits broker jumps at the opportunity tosolve his client's problem and asks the TPA at what level theemployer must contribute to the plan. With the understanding theplan must be affordable (employer contributes all but 9.5 percentof premium/funding), the bar owner is ready to absolve himself ofpenalties, and assume the risk of a self-funded plan.

The broker, bar owner and TPA solidify plans to implementbenefits that have no clear precedent. The regulator is not heardfrom again until February 2015 when final rules are issued. PatientProtection and Affordable Care Act; HHS Notice of Benefit andPayment Parameters for 2016 states that hospitalization must becovered in order create a minimum value plan.

Fast forward to present day. The bar owner, broker and TPA aremeeting to begin discussions on how to modify the plan that's inplace. It must be changed at renewal. Will they stick with minimumvalue? Or drop back to MEC?

The preceding story is fictional. Any similarities to people,events and places are mere coincidence. But this exact situationplayed out repeatedly in different ways across the United Statesthis past summer and fall. As hourly and part-time employees werethrust into the core benefits conversation, so were voluntarybenefits brokers. Consultants, TPAs and others who focused much oftheir career on traditional benefits suddenly had to create andrecommend benefits solutions for large groups of employees who hadbeen benefits afterthoughts for years. This collision of worldsprovided many controversial product solutions, moving targets andthings that now must be fixed.

So what happens next? What should today's broker be preparingfor? Does the employer mandate for the 50-99 employees marketcreate opportunity? What is working for the hourly and part-timeworkforce? What should be recommended? See you at the BenefitsSelling Expo to talk about all of this.