The Affordable Care Act (ACA) and the Self-Employed or Small Business Owner: Interview with Shira McKinlay, Esq.

  For this post, I was lucky enough to be able to interview my colleague Shira McKinlay about the ACA.  I wanted to know about the ACA’s impact on small businesses. Shira knows her stuff and I thank her for this timely and informative post.

Barb: Can you describe the biggest positive and perhaps negative changes affecting small businesses?

Shira: Probably the biggest positive change of Health Care Reform for small businesses is the small business tax credit.  Small businesses may qualify for this tax credit if the business has less than 25 employees, pays average annual wages below $50,000 and provides health insurance to its employees.  Through 2013, the tax credit will be up to 35% of premium contributions.  Beginning in 2014, the amount increases to 50% for small businesses that purchase coverage through Health Insurance Marketplace (or the “Exchanges”).

Even small businesses that do not qualify for the small business tax credit should benefit from being able to purchase coverage through the health care Exchanges.  Colorado’s Exchange, Connect for Health Colorado , may offer small employers better, more transparent choices and potentially more affordable coverage for their employees for coverage beginning January 1, 2014.  The Colorado Exchange is expected to open for enrollment October 2013.  Of course, until the Colorado Exchange is up and running, we will not know the exact impact it will have.

As for the negative impact, fully insured small employer plans are subject to some additional requirements (such as requiring plans to cover all Essential Health Benefits, setting maximum deductibles) to which large-employer plans and self-insured plans will not be subject.  However, employers with less than 50 full-time employees are exempt from Employer Shared Responsibility provisions of Health Care Reform, and still are not required to provide any coverage if they so choose.

Barb: What are the biggest changes for self-employed types?

Shira: I would say that two of the biggest changes for this group would be the required coverage for individuals as well as access to the health care Exchanges.

Self-employed individuals will be required to comply with the Individual Shared Responsibility provisions of Health Care Reform, beginning in January 2014.  Individuals will be required to have minimum essential coverage, qualify for certain exceptions, or pay a tax penalty that is the greater of a flat dollar amount or a percentage of taxable income.  Although the initial tax penalty is quite small ($95 for 2014), the penalty increases to $325 in 2015, $695 in 2016, and annually thereafter based on a pre-determined formula.

Access to the Exchanges will offset some of the burden of the Individual Shared Responsibility requirements.  The Exchanges will offer core packages of benefits to individuals and, as mentioned before, small businesses.  In addition, if a self-employed individual decides to get coverage through an Exchange, premium tax credits may make such coverage more affordable.  The availability and amount of such tax credits will be dependent on household income.

BarbAny big picture observations about the legislation and the opportunities it creates for small business?

Shira: A lot is going to depend on the success of the health care Exchanges.  If the Exchanges work as planned, small businesses and self-employed individuals will have access to quality health care at affordable prices.  However, until we hear the costs of the plans offered on the Exchanges, and until we see that the Exchanges are up and functioning, it is difficult to say how small businesses and individuals will be impacted.

At a recent presentation, one of the members of the Board of Directors of Connect for Colorado stated that the Colorado Exchange will be up and running smoothly on October 1.  After hearing him speak, I have high expectations, at least for the Colorado Exchange.

On the other hand, the federal Exchange (available for the states that chose not to run their own health care Exchange) does not seem to be faring as well.  It was originally expected that small businesses would be able to offer their employees a choice of health plans through the federal Exchange starting in 2014.  Instead, this plan-choice option has been delayed for the federal Exchange, and small businesses opting for coverage under the federally-run Exchange will be limited to offering a single plan to their employees until 2015.

If the Exchanges function as planned, this could offer exciting opportunities to small businesses and individuals.  Individual entrepreneurs who are debating going out on their own for fear of losing their employer-provided health care may now be able to make that jump.  Small businesses may be able to provide affordable health care to their employees with the help of the small-business tax credit.

Barb: Thanks for your insights Shira – any concluding comments? 

Shira:  You are very welcome.  2014 is going to be a big year for health care!  Until we see exactly how the Exchanges are going to work, predictions are only guesses.

Shira McKinlay is an attorney with extensive employee benefits experience.  She has advised businesses on employee benefit and ERISA compliance and opportunities, as well as performing audits and reviews of health and welfare plans.   In her practice, Shira has provided advice on design and documentation of health and welfare arrangements and has drafted and developed plan communication materials, including summary plan descriptions, summaries of material modifications and required participant notices.  Shira has been active in helping companies comply with, and strategize for, changes brought on by the Affordable Care Act (health care reform).  She has assisted with the implementation of HIPAA regulations for group health plans.  Shira also counsels companies on issues related to FMLA, as well as benefit plan matters that arise in mergers and acquisitions.  She is director of Denver Compensation & Benefits, LLC, a compensation, benefits and retirement plan consulting firm. The firm’s professionals, which consist of both attorneys and CPAs, practice exclusively in the compensation, retirement plan and benefits area and have experience dealing with complex issues for employers of all sizes.

Elder Law Ethics or “Why Am I Left Sitting in the Waiting Room?”

View from the roof of the Denver Art Museum

I am openly borrowing from the title of an American Bar Association pamphlet “Why Am I Left in the Waiting Room?:  Understanding the Four C’s of Elder Law Ethics.”  You can read the pamphlet here.    Estate planning is a law practice area that has historically had joint representation as a feature.  This is typical where a married couple, partners in a civil union, or committed partners, do their estate planning together.  Most lawyers have a written fee agreement for this and for a husband and wife the agreement often contains a joint representation waiver which gives both clients the opportunity to consent to one attorney representing them (this typically makes the most sense from a planning and financial perspective) after the attorney advises them of the unique nature of joint representation.

Elder law practice often encompasses the more traditional estate planning services but there can be nuances to the attorney-client relationship when an adult child brings an elder to an attorney’s office.  It is not uncommon for an adult child to find and “vet” an attorney on behalf of the parent.  Sometimes the adult child may wish to pay for the legal services.  Often the adult child has been very involved in the parent’s day-to-day life, but the nature of the attorney-client relationship has boundaries.  The pamphlet referenced above goes over the “four C’s” which an informed client ought to consider, and with which the attorney is assumed to be familiar.  The attorney, after all, is the license holder who is bound to uphold the Colorado Rules of Professional Conduct.

So – what are the “four C’s?

  1. Client Identification: attorneys must communicate and make clear to the client(s) who is the client, and oftentimes – who is not the client.  Even if the elder is not footing the bill for the consultation, the elder is the attorney’s client.
  2. Conflicts of Interest: lawyers have an ethical duty to avoid conflicts of interest – these can crop up whenever an attorney represents more than one person.  When an attorney represents several people with joint or mutual interests, the lawyer is bound to identify potential conflicts of interest and determine whether joint representation is appropriate or allowed.  This can be particularly problematic in an elder law context where one attorney talks with an elder parent and an adult child and it is not clear who the client is – this is why #1  above is #1! Identifying the client means identifying the person to whom the lawyer owes all applicable duties.
  3. Confidentiality: A hallmark of the attorney-client relationship is communication and lawyers must keep confidential the communication between clients and lawyers confidential.  By way of example, it means that if I represent an elder parent and draft a durable power of attorney for them and they want me to be able to talk to their adult child agent about how to use the POA if the need for using it arises, I need to get specific authorization from them to talk with the adult child agent – because the elder parent is my client and I owe a duty of confidentiality to my client.
  4. Capacity: the ABA pamphlet refers to this as “competency” but I find the term “capacity” more appropriate.  Sometimes an adult child will inquire about getting a will drawn up for their parent who is in failing health. Some folks think that a lawyer can simply take instructions from another person about what the elder wants in their will and present and then present such a document for signature by the elder.  This is not appropriate on many levels.  Lawyers are duty bound to get informed consent from their client – on whose behalf the document is prepared –  for a particular course of action.  This means educating the client about the range of alternatives to choose from and then allowing the client to make their own choice among the alternatives.   This can be challenging in the elder law field – particularly when a client may be hard of hearing, vision impaired, or experiencing temporary or ongoing cognitive decline.  The lawyer must determine (as with any type of client) whether a client has the capacity to enter into an attorney-client relationship.

The bottom line for elder law attorneys is that we don’t want our clients’ wishes and choices made to be subject to scrutiny and undoing at a later date because the lines of 1, 2, 3 and 4 above were blurred!  If you bring your mom or dad or Aunt Ethel into my office, rest assured that I will talk to you as well – but I will have you spend some time outside in my waiting area.  Don’t worry, there are good magazines to read.

©Barbara Cashman

June 15 is World Elder Abuse Awareness Day

The National Center on Elder Abuse of the Administration on Aging has declared June 15 World Elder Abuse Awareness Day.  Go to this link to find a local activity.   Yes, since this is a “World” day, there is also a United Nations declaration and such commemorations started in 2006 – in case you’re wondering.  The U.S. HHS Administration on Aging suggests three ways to be involved:

(1) Developing an educational program or press conference;

(2) Volunteering to call or visit an isolated senior; or

(3) Submitting an editorial or press release to your local newspaper to create awareness of elder abuse, neglect, and exploitation.

I hope this blog post meets the third criterion!

You can find excellent resources and stay posted on Colorado developments by going to the website of the Colorado Coalition for Elder Rights & Abuse Prevention  and you can sign up for their e-newsletter there.  In my recent visit to the site there was a link to a page entitled “culture change” which addresses person-centered care.  You can click here  for my blog post refresher on that topic and its originator, Tom Kitwood.  The culture change that the CCERAP site describes is about focusing on the needs of the individuals requiring care and those working closely with them.  This challenge is one we face on personal, community, national and global levels with the ever-growing number of elders in our communities.  It forces us to think about how we would want to be treated in similar circumstances.

So on the topic of elder abuse and the vulnerability of a particular group of elders – those experiencing cognitive decline associated with a dementia disease process, I will take a look at Alzheimer’s Disease and Recent Observations from Biophysics.

Okay, I don’t think I’ve ever typed the word “biophysics” but there it is. I subscribe to Scientific American’s email news and there was featured a guest blog post by Frank Ferrone entitled “Dangerous Braids that Tangle in Brains and Veins.”  You can read it here.   This article is about the importance of research, the accumulation of scientific knowledge and connections that can be made at a later date when more research is accomplished or perhaps investigatory techniques, often technological, allow more thorough information to be gathered.  Alzheimer’s Disease is a very particular type of dementia and it is only conclusively diagnosed post-mortem of those who had the disease.  Its calling card is the beta-amyloid protein molecule  which causes the plaques and tangles associated with the shrinkage of brain function. It turns out that these braided molecules share a lethal trait with the deadly molecules associated with sickle-cell disease, which allows both of these molecules to quickly build their housing (polymers) and spread their disease to a wider area.  What Ferrone concludes, hence the biophysics moniker – is that the two diseases [Alzheimer’s and sickle cell], disparate in manifestation, obey the same fundamental rules.  This is what Biophysics is all about, the discovery of fundamental physical laws that govern the behavior of diverse biological systems.   Ferrone’s discovery (made with others), published back in 1985,  was relied upon by Alzheimer’s researchers at Cambridge University for their new discovery.

Biophysics and biochemistry figure prominently in research in dementia – its proper diagnosis, treatment and of course prevention. Interested in the aging process in terms of entropy, mitochondrial decay? Read this excerpt.

All this overlap reminds me of a blog post I did for SoloinColo on The Hero’s Journey, in the Facebook for Lawyers context. . . .  where I described our networked society in the mythological term “special world.” That post (part of a twelve part series) can be read here  and referred to an article by a mathematical biologist.  Perhaps Alzheimer’s research will continue to be a cooperative proving ground in helpful ways.  If research on the disease can promote cooperation in substantial and significant ways and our ideas about identity and functioning are challenged with an ever-growing number of elder-boomers – then perhaps there is hope for us!

Yes, I could publish this post without a poem, but with no shortage of beautiful sources . . .  why would I?  This one (known as II,16) is by Rainer Maria Rilke (yes, he is one of my favorites):

How surely gravity’s law,

strong as an ocean current,

takes hold of even the strongest thing

and pulls it toward the heart of the world.

Each thing –

each stone, blossom, child –

is held in place.

Only we, in our arrogance,

push out beyond what we belong to

for some empty freedom.

If we surrendered

to earth’s intelligence

we could rise up rooted, like trees.

Instead we entangle ourselves

in knots of our own making

and struggle, lonely and confused.

So, like children, we begin again

to learn from the things,

because they are in God’s heart;

they have never left him.

This is what the things can teach us:

to fall,

patiently to trust our heaviness.

Even a bird has to do that

before he can fly.

     From Rilke’s Book of Hours: Love Poems to God, translated by Anita Barrows and Joanna Macy.

Life is uncertain and old age – even more so.  Perhaps old age and its inward pulling-ness is a kind of gravity, a force that we all share but one that isn’t easily recognized or understood.  Is this because we each live our own lives, separately and pulling away, or perhaps as a result of that long-term denial.  How difficult would it be to trust that gravity, that heaviness that we can look at things – our lives and our relationships – in new ways . . .  even in our oldness (or perhaps only as a result of it).

©Barbara Cashman

Elder Law and Probate Conflicts: Looking at Some Sources of Conflict

I visited the Chalk Art Festival last weekend at Larimer Square in downtown Denver.  Once again, my cousin Marty Calomino  was an artist exhibitor.


This is a picture of his chalk detail from Red Horse’s pictographic account of the Battle of Little Bighorn.  I love looking at chalk art because it is so unabashedly temporary.  I think part of that distancing ourselves from art – that happens to most of us after about the third grade or so, is as a result of thinking of art as something big and permanent made by “artists.”  What is deemed art tends to fluctuate over time. . . .  that’s where I tie in chalk art with conflict and old age!

Let’s face it – for many of us, old age is “the enemy.”  I include here beloved poets such as William Butler Yeats who has described it as a time of regret.  For others of us, old age has a different meaning.  Resident in this camp are poets like Walt Whitman, who penned

Youth, Day, Old Age and Night:

Youth, large, lusty, loving–youth full of grace, force, fascination,

Do you know that Old Age may come after you with equal grace,

force, fascination?

Day full-blown and splendid-day of the immense sun, action,

ambition, laughter,

The Night follows close with millions of suns, and sleep and

restoring darkness.

The fact remains that old age simply scares many of us.  Death at the end of old age, after an illness – or anytime we can see its approach – well , this is more than many of us can bear.  Hence the conflict.  Conflict is a part of life, so it is natural.  What is it about how we deal with aging, frailty and health care challenges that make these particularly susceptible to conflict?  The answer to that is, as my late father used to say “autobiographical.”    Sometimes the conflict is barely detectable or it is underground.  At other times, open hostilities may feature verbal violence, threats and even physical violence.

So where can someone turn for help? Finding the right fit to get help to manage or resolve a conflict can be a very daunting task.  As an elder and probate mediator I often hear from people – often adult children and other family members – who are looking for assistance in resolving their dispute before they feel a need to resort to the court system.  Often there is at least one person ( a stakeholder ) and sometimes a bloc of persons who will simply not take any action to remedy a situation unless they themselves choose to originate the action.

So let’s take a look at conflict at the end of life – and identify a few of its more predictable sources:

  1. Health care choices – who makes them and how to decide, what to decide

I have written a few blog posts on the topic of conflict in the health care setting at the end of a person’s life.  But this kind of conflict is not limited to a hospital or even home hospice care, and the conflict can arise whenever there is interaction among people, often family members, who have differing expectations, beliefs and different coping strategies for facing another’s illness and the end of life.  In Issue 73 (March 2013)  of the Health Care Chaplaincy newsletter (to which I subscribe) one of my posts  was quoted by Rev. Jill Bowden, director of chaplaincy services for Memorial Sloan-Kettering Cancer Center for my observation in a blog post that “a  patient’s impending death ramps up emotionality…and often leads to emotional, verbal  and sometimes physical outbursts of violence among family members and loved ones.”

If the right people can agree to participate, mediation or family facilitation can help family members productively manage difficult situations.  Overcoming the inertia to contact a mediator or other third party neutral can be difficult, and it is often challenging to convene all the participants (also known as “disputants”) to a family meeting or mediation, but it can be done.

2. Financial matters – who is in charge and who has the authority to manage a person’s affairs?

You might be wondering why I distinguish here between who is in charge and who has to authority to manage another’s finances.  The person “in charge” may be the person who is getting assistance from another with organizing and managing paying their bills.  More than once, in durable power of attorney scenarios where an agent has taken over a principal’s affairs, I have heard the agent describe themselves  as a person having “power of attorney over” the principal.  That really reverses the purpose of the POA and turns the tables on who works for whom.  The agent works for the principal and serves the principal’s interests.  Sometimes agents are ignorant of or forget this important detail.  On several occasions I have seen an agent who has been acting under a power of attorney and the agent has not educated him- or herself about how to behave and transact business for the principal as the principal’s agent.  Also, in a situation where there is one adult child “in charge” and another with the legal authority to act on behalf of the principal, this can be a another source of conflict.

3.Conflict in a decedent’s estate administration – after someone has died

If the illness and death of a loved one has produced conflict among family members, and if the conflict is still simmering or about to boil over, opening an estate can be the match in the tinderbox.  Sometimes the person who was in charge of or presided over a deceased person’s finances will have their authority revoked or rescinded by the disapproval of others.  The level of misunderstanding in this context of grief can increase exponentially.  Many families and blended families with adult siblings can figure out ways to weather this storm while others cannot.  The glue that held the family together, the deceased parent – on whose behalf the warring siblings were once able to rally together, is now gone.  Sometimes the wishes of a parent and their memory are insufficient to overcome their difficulties in getting along.  This adds to the individual’s and the collective grief.

In a later installment, I will talk about how these disputes can be aired and productively managed in a family meeting or, if the conflict is protracted – in mediation.

©Barbara Cashman