Rich Herdegen is already feeling the pinch of federal health care reform.
Herdegen, who is disabled and faces massive medical bills from his wife’s long battle with cancer before her death, relies on his salary as an adjunct instructor in economics at Georgia Military College’s Augusta campus. But this quarter his hours have been cut, costing him about $2,000, he said.
“That’s a lot of money,” Herdegen said.
Hours were cut for a number of adjunct or part-time faculty at the college, in part because it is moving on advice to comply now with requirements of the Affordable Care Act, a move that might actually be premature. Even experts in academic human resources say there is “general confusion” about the act’s implementation and impact.
At issue is the 30-hour-a-week rule that would make an employee count as full time under the Affordable Care Act and require a large employer to offer them insurance.
In July, the Obama administration decided to delay that requirement one year, from 2014 to 2015, along with the penalties for not providing insurance for employees.
However, Georgia Military College had already begun taking steps to limit faculty hours. Professional associations advised that the Internal Revenue Service would make colleges count an additional hour of preparation for every classroom hour taught, which could push some part-time faculty past the 30-hour mark, said Mark Strom, the college’s director of human resources.
The college has to plan months ahead to know who is going to teach what course, he said. So he advised campus directors to begin weighing hours that way and to curb those who might qualify as full time.
Each employee on the health plan costs the college $7,155, and that will go to $9,000 for family coverage next July, Strom said.
“It would not take many of those to really create a financial issue for our annual business plan,” he said. “We’re doing the best we can in a very tough market. Higher education has become very competitive.”
Any extra expense would have to be covered by enrollment or tuition increases, Strom said.
But the advice the college was following was wrong. The College and University Professional Association for Human Resources and other higher education groups met with the IRS last year and in the spring to talk about this and other issues, President and CEO Andy Brantley said.
It was “to bring to their attention some of the particular challenges associated not just with higher education but with part-time employees in general,” he said. So far, the IRS has not responded, Brantley said.
“There is no specific guidance from the Internal Revenue Service at this point in time that gives us the specific information we need as employers to determine next steps,” he said.
Colleges and universities should be prepared to deal with the issue, Brantley said, “but making a formal decision at this point in time is not necessary to be in compliance with the Affordable Care Act.”
Georgia Military College isn’t alone in acting now. A survey by the academic HR group found a quarter of schools had already decided how they will calculate part-time hours and two-thirds are working on it, Brantley said.
The drop in hours has Jim Brady, who teaches communications at Georgia Regents University and as an adjunct at Georgia Military College, wondering how he will meet all of his bills.
“Somebody is not going to get paid because the money will not be there,” he said.
Strom said even if the school dropped its changes, it might just be forced to change back again next year.
“We’re going to hold the line on that,” he said. Strom urged directors to be flexible and work with adjuncts on how those hours are managed.
“The last thing we want to do is lose good part-time faculty that have worked with us for a while,” he said.
Strom said he is looking for information every day on how and when different aspects of the law will kick in.
“In my 26 years of doing human resources, this is the most complex law and the most confusing implementation of any major law that I have seen at the federal level,” he said.
Brantley said he can sympathize with that confusion.
“I don’t fault that institution or that HR person at all,” he said.