Fees the federal government will impose Jan. 1 to help fund provisions of the Affordable Care Act will cost the city of Albuquerque an additional $875,000 in the current fiscal year and Bernalillo County an additional $349,000, according to a city Budget Division analysis.
In all, 17 agencies and local and county governments that have come together to create an insurance purchasing pool will face an extra budget hit of $1.452 million between Jan. 1 and the end of the 2014 fiscal year June 30 – over and above the money they already spend to provide health insurance to employees.
That amount would double to nearly $3 million for a full year in fiscal 2015.
The ACA imposes a $5.42 monthly fee on each of the 22,700 members of the health insurance pool, which is purchased from Presbyterian Health Plan by the city and county, along with Sandoval County, the city of Belen, the towns of Bernalillo, Edgewood and Mountainair, several villages – Tijeras, Cuba, Corrales and Bosque Farms among them – and agencies such as the city/county Water Authority.
The law requires $5.25 per member per month be collected through 2016 to help states fund high-risk pools for individuals who purchase insurance.
Congress anticipated that many of the nation’s newly insured have been putting off getting treatment of conditions because they had no way to pay for care. These people are expected to require relatively expensive care immediately, so the ACA provides a funding source for that care.
The act also requires insurers to collect a fee amounting to 1.6 percent of monthly premiums to help fund subsidies the ACA provides to individuals earning from 100 percent to 400 percent of the federal poverty level, and for some small businesses. There is no time limit on this fee.
The charges do not provide any additional direct benefit to people already covered by city or county health insurance.
Another 16 cents per member per month goes to pay for research into the most effective treatments for different medical conditions. That fee ends in 2019.
The city of Albuquerque currently spends $4,403,535 a month on health insurance for employees and their dependents. The cost will rise to $4,549,373 a month when the fees take effect, an increase of 3.3 percent.
The county’s monthly expenditure of $1,760,980 will increase to $1,819,140 beginning Jan. 1.
The fees will cost Sandoval County an extra $53,683 this fiscal year, the Water Authority $101,846, Belen $10,997, Bernalillo $7,015, Corrales $6,062, Edgewood $3,216 and Los Ranchos de Albuquerque $1,006.