Street Talk

Street Talk: Countdown to the Affordable Care Act

Where to buy beer.

August 16, 2013
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A major transition period for the Affordable Care Act — aka Obamacare — starts Oct. 1, with the beginning of open enrollment in the new health insurance exchanges for all who do not have health care insurance.

All types of businesses and organizations are starting the drum roll.

The Michigan Business and Professional Association bills itself as the “go-to source about health care reform and its effect on your business.” It has a lot of information online and will hold a conference in Troy Sept. 24 featuring a speaker from the U.S. Department of Health and Human Services.

The National Association for the Self-Employed said it has just released what it calls “a key guide, The Affordable Care Act in Brief, to educate and help assist Michigan’s small business community during this transition period.” The NASE headline says “over 800,000 Michigan small businesses brace for new health care reform law.” There could be a little self-interest involved here; the NASE refers its members to sources of health insurance.

NASE said there were more than 667,000 self-employed people in Michigan in 2011 who don’t have any employees and another 133,336 micro-businesses in 2010 with fewer than 10 employees. Those micro-employers aren’t required to buy insurance for their employees.

As for the 667,228 who are self-employed: Many already buy their own health insurance, so the ACA requires nothing of them, either. An executive at NASE was asked about that.

“For the self-employed, the purchase of health insurance is directly tied to the income generated from their business,” replied Katie Vlietstra, director of government affairs for the NASE in Washington. “Further showing the inequity faced by nearly 23 million business owners, the self-employed are the only business entity that is unable to deduct the cost of their health insurance as a business expense,”.

Self-employed people include the fellow with the pickup truck who does odd jobs. He may be one of those who have been getting by without insurance, so the ACA is going to make a difference to him. But self-employed also includes professionals such as Jim Strobridge, who happens to be a member of NASE.

“I have my own insurance,” said Strobridge, a 50-something professional from Grand Rapids who is a certified industrial hygienist with 33 years of experience. Since 1995, he has worked as an independent consultant to business on industrial hygiene, indoor air quality and safety issues.

Strobridge’s business is just he and his wife, who helps with the books. They pay for their own health insurance and have done so for years, so they don’t have to do anything in response to Obamacare — but the subject sends him through the roof.

When Obamacare was passed by Congress, “within a year, my insurance rates doubled,” he said. He was paying about $600 a month and now it’s more than $1,100, through Priority Health. “They keep nicking me” with other charges, he said.

Strobridge said he has never been given an explanation about why his insurance cost doubled, but he is convinced it is a direct result of what he calls “the Obamacare nonsense.”

“They’ve all been lies,” he said, regarding claims that under the ACA, health insurance costs would go down and service get better. “Even now, people are still trying to figure out what in the hell is in the thing and how to implement it and how to pay for it. … The whole thing has been bogus from the get-to,” said Strobridge.

“What they should have done is just gone out and bought insurance for those 15 percent of the people and left the rest of us alone that had our own plans,” he said.

But the cost increases he has experienced may or may not be related to the ACA.

It appears it is the health insurance industry that may see the biggest potential impact on its business: The ACA includes controls to help reduce the amount of money laundered out between the consumer and medical care provider. Last year the Kaiser Family Foundation reported that more than a billion dollars would have to be refunded to insurance customers (employers and individual consumers) in 2012 because many insurance companies did not spend the ACA-required 85 percent minimum of their revenues on actual medical care received by their customers.

Making waves across Michigan

Bell’s Brewery recently filed a lawsuit against Enbridge Energy and Comstock Commerce Park’s developer, CCP Development Co., over plans to dredge the Kalamazoo River, the site of a large Enbridge oil spill in 2010.

In March, the U.S. Environmental Protection Agency ordered the company to dredge the river as part of its cleanup efforts. Since then, Enbridge leased land next to Bell’s Comstock Township brewery and began construction on the dredge pad without approval by Comstock Township. Residents and business owners have complained, including Bell’s owner, Larry Bell, about the potential air pollution from the dredging.

“It’s highly detrimental to our business and the well-being of the residents,” Bell said.

Comstock Township supervisor Ann Nieuwenhuis sent a letter to the Michigan DEQ in support of opposition.

Since the lawsuit was filed, Enbridge has begun exploring options for other dredge sites and is seeking an extension on the Dec. 31 deadline.

Meanwhile, Bell’s announced that plans for a brewery in the Upper Peninsula are evolving. The original plan called for Upper Hand Brewery construction to begin in Whitetale Industrial Park in Escanaba Aug. 1. But the location has changed.

“There was a soil compaction issue on the original site,” Bell said. “You can build anywhere, but we decided to go to an alternative site.”

The project has been moved to a five-acre slice of land at the Delta County Airport. Construction of the 11,550-square-foot brewery is expected to cost $1.3 million. Bell hopes it will open in spring 2014.

The brewery will not produce Bell’s products. “This is sort of a fun project,” he said. “It’s not Bell’s.”

The brewery will produce beers for distribution across the U.P., northern Wisconsin, Minnesota and North Dakota. Bell said the beers will not be distributed below the Mackinac Bridge, which could mean an increase in traffic by the Lower Peninsula “trolls” crossing into “upper” territory.

Bell’s new taproom at the Gerald R. Ford International Airport is gearing up for an opening in early September, Bell said. The bar is licensing the Bell’s name, but Bell said the company will have a say about certain aspects and will soon spend time decorating the location. The bar came about because of retail and concession operator HMSHost.

“They approached us, and we talked and came to an agreement,” Bell said. “It’s our first foray into this sort of thing, but it makes a lot of sense for us to be a part of the airport as it grows.”

Tech firm grows old

Trivalent Group, one of Michigan’s largest technology firms, is celebrating its 10th birthday — and 100 consecutive months of profit. The firm, born from a merger between Remex Corp. and Trivalent in August 2003, has continued to see business growth, being named multiple times to CRN’s List of Tech Elite 250 and Nine Lives Media Inc.’s top 100 global managed service providers.

“Celebrating the life of our company for 10 years is an exciting time for us, but to be able to be profitable for 100 consecutive months is an even greater accomplishment,” said Trivalent Group CEO Larry Andrus. “We have a great team at Trivalent Group and without them none of this would be possible.”

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