By Dick Asher, ABC GIMA
The State Procurement Regulations that will govern the implementation of recently enacted legislation regarding the payment of employee health care expenses for State-funded construction projects are finally here.
The good news is that through ABC Greater Baltimore’s diligent efforts in the past to chip away at or eliminate the most onerous of the rules, the current regulations aren’t anything we can’t handle. What’s more, ABC Greater Baltimore has a work around, designed to help our members achieve compliance easily and affordably.
On November 21, 2020, the Board of Public Works authorized the submission of these regulations to the AELR Committee and for public comment in the Maryland Register. The regulations are the final proposed language for legislation was originally passed in 2019 and ABC Greater Baltimore was successful in getting amended in 2020.
Major policy provision
All employers with 30 and fewer employees are exempt.
If your company falls outside those parameters, there’s additional language that ABC Greater Baltimore was successful in getting inserted into the original bill that helped lessen the burden for not only our larger members, but for all our members. The proposed code states that “Under a contract with a credible health care insurance plan or through a collective bargaining agreement, the bidder, contractor, or subcontractor pays some portion of employee health care expenses.”
Under the bill’s definitions, employee health care expenses means “any costs for health care services that are paid by a responsible bidder or subcontractor to an employee, unless the employee has coverage under another plan.”
The employer’s responsibility is that they must pay a minimum of 50 percent of the employee’s premium.
What that means is that an employer, in order to be in compliance, doesn’t have to have a health care insurance contract for its employees. Employers only need to have credible health care coverage, which can take many other forms. These include offering a Health Savings Account (HSA), setting up a health care reimbursement program (SRA), and providing payments to a third party for the purpose of providing health care services for employees, among other options.
Get in compliance today
That’s where ABC’s Smart Return Account comes in. Here’s how it works: The employer establishes an SRA for all of its field employees. Because state work falls under prevailing wage, there’s a fringe portion of the wage that’s supposed to be used for benefits. Employers can designate a portion of that fringe wage be used to qualify as a “credible health insurance plan.”
For example, through ABC’s Smart Return Account, an employer can set aside $1 out of $8 used for the fringe benefit. In turn, the employee gets that dollar in a Visa card that they can be used for any credible health care expenses. It costs $250 to set up the program through ABC Greater Baltimore.
For more information about ABC’s Smart Return Account, or the legislation, contact me, Dick Asher, directly at email@example.com or 443-617-2668.
Public comments on the regulations will be accepted through February 3, 2021. If you have any additional comments you would like to submit, I ask you to contact me directly, so we can amplify our members’ voices.