What runs 37 pages, takes two experts three days to figure out and could have massive cost implications for your company?

Answer ” the federal health care reform law’s definition of a full-time employee.

That’s right, a full-time employee. We can hardly wait to decipher the rest of the regulations as the federal Affordable Care Act (ACA) washes over the infrastructure of the existing 2006 Massachusetts Health Care Reform Act.

Massachusetts employers are increasingly concerned that a perfect storm of bureaucratic complexity, increased fees and conflicts between the state and federal law threaten to create significant financial burdens when the bulk of the ACA kicks in next year. Employers are also concerned that the face-to-face negotiations among business, doctors, hospitals and insurers that made Massachusetts health reform a success will be missing from the implementation of the massive federal law.

Sandra L. Reynolds, Senior Vice President at AIM, and Russ Sullivan, Vice President of Health Care Programs, who together have spoken to thousands of employers around the country about health reform, said the new regulations on full-time employees are crucial for companies trying to determine how they will be affected by federal reform.

Employers must determine whether they have at least 50 full-time and full-time equivalent employees in one calendar year to know if they have to comply with the ACA the following calendar year, and must also determine whether an employee is “full-time,” as defined by the ACA, so that, in order to comply with the ACA, they must be eligible for the employer’s health plan.

“It took me three days of reading and re-reading and re-reading and making notes to begin to grasp the regulations on full-time employees,” said Reynolds.

“Many Massachusetts employers would have preferred that the state’s regulations be more specific on how to determine whether an employee meets the state’s definition of full-time.  It’s a classic case of being careful what you wish for since the feds go into excruciating detail in defining when and how an employee is “full-time.’ It really adds to the complexity for employers who utilize part-time, per-diem, seasonal and temporary employees.”

And the eye-straining regulations are just the beginning. A review prepared for the AIM Health Care Cost and Policy Committee two weeks ago indicates that three elements of federal health care reform – a tax increase on health insurance, a shift in the size of small-group markets, and a series of rating changes ” could leave many Massachusetts employers and consumers with increased health-care bills.

The tax increase on health insurance premiums will cost employers and consumers in Massachusetts $213 million in 2014 and $3 billion during the next decade. Average monthly premium costs will rise anywhere from $24.06 to $65.79 per policy, depending upon employer size and individual or family coverage.

The impact of changes to rating factors and the size of the small-group market could reduce premiums by an average of 2.5 percent for companies with 1-50 employees, with smaller companies faring better than those with 25-50 workers. The changes would increase costs 7.5-10.5 percent for companies with 51-100 workers and as much as 3 percent for companies that employ more than 100 people.

At the same time, Governor Deval Patrick has proposed eliminating two key employer contribution requirements – the Fair Share contribution created under the 2006 Massachusetts Health Care Reform law and the Medical Security Program under which employers contribute money to provide low-income unemployed people with health insurance – and adding an “employer responsibility contribution” of $50 per employee per year to subsidize unemployed people obtaining health insurance either though MassHealth or the Commonwealth Health Insurance Connector.

AIM supports the move to eliminate the Fair Share and Medical Security assessments, but needs to study details of the employer responsibility contribution.

The association urges the federal government to consider a “delegation approach” that would give Massachusetts and other states discretion to implement and enforce their rules.  Flexibility would go a long way toward easing the negative impacts of the rating changes and other elements of federal reform.

It all adds up to a huge challenge for AIM as the association works to keep up with all of the new federal regulations and translate the information to member employers.

“Last year at this time we believed that implementing the Affordable Care Act in Massachusetts would be a smooth transition because we have more than six years of Massachusetts health care reform behind us,” said John Regan, Executive Vice President of Government Affairs.

“But, as we learn more about the details of the federal law, as regulations and guidance are released, the less we believe this to be true.  Massachusetts employers must undo many of the procedures they put into place to comply with the state law in order to comply with the federal law.”

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