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President`s Letter: Are You Prepared for the Affordable Care Act?

A few years ago, we watched with interest the debate about reform of the healthcare system and the subsequent passage of the Patient Protection and Affordable Care Act (PPACA). While there's little disagreement that the healthcare system in this nation needs to change, there was little agreement that the PPACA was the solution.

Much was made of both how complex the healthcare system is and, therefore, how complicated any proposed changes would need to be. Even the supporters of "ObamaCare" acknowledged that they didn't really understand all the nuances of the bill. As time goes by, we're beginning to understand some of the consequences—intended or not. There are several components of the PPACA that may impact your fire department.

The first potential impact is in the healthcare delivery system. Currently, the healthcare system is very hospital-centric. That is, the whole system revolves around the hospital as the core. In the case of EMS, we only get paid if we transport to a licensed hospital (in most states).

The world of healthcare that is created under the PPACA recognizes that the hospital is a very expensive tool to use as the center of the system and will open up a variety of other options for healthcare delivery. It will actually shift the reimbursement system such that the financial incentives will be aligned to encourage treatment somewhere else other than a hospital.

This evolution of the healthcare system will open up a new world of possibilities for fire departments that provide EMS. We may get paid for transporting somewhere other than hospitals. We may get paid for engine company first response. There may be the possibility of getting into new businesses related to out-of hospital care.

Some may look at these healthcare system changes as threats and others may look at them as opportunities. Some will see no impact at all. It will all be highly dependent on the specifics of your community, who the healthcare heavy hitters are, the current role of the fire department in EMS, and what other players are on the field.

It will be smart for all of us to watch closely and pay attention. The IAFC EMS Section and the Government Relations staff are watching these issues and will keep us informed. If you're not already a member of the EMS Section, you should consider joining so you can support them in their work and tap into their expertise on this and other EMS issues.

The second potential impact is on fire departments as employers. There are a number of provisions of the PPACA that impact employers and our requirements to provide access to health insurance for our employees (or pay a penalty). If you're a large employer—that's 50 or more employees or the equivalent—you'll have a requirement to provide health insurance. Seems simple enough, right?

If you're one of these large employers, do you have part-time employees who don't receive benefits? Do you have volunteers? Do your part-timers or volunteers average more than 30 hours per week? If the answer is yes, you may need to also provide health insurance for those part time employees or volunteers. The consequence of failing to provide the required insurance will be stiff fines.

The IAFC Government Relations staff is actively engaged on this issue and there are a number of fire service groups working on changing what we believe are unintended consequences of the PPACA. But if the law is implemented by the IRS as they seem to intend to, those of us with part-time employees or volunteers may face a huge new expense.

Significant reform of the healthcare system is on the way. In fact, the train has already left the station. Fire service leaders will need to stay ahead of this issue from the perspective of the opportunities and the threats it may pose to the fire service. The only remaining question is whether you're prepared to deal with the impacts on your organization. The IAFC is closely following developments and will keep our members informed as the issue develops. Stay tuned for more details as they become available.

Chief William R. Metcalf, EFO, CFO
President and Chairman of the Board

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