When Jackie McMann-Oliveri started as human—resources director at the Meatball Shop in July 2014, she knew the company had to act quickly to prepare for the requirements of the Affordable Care Act.
The six-restaurant chain would shortly be responsible for providing health benefits to even its lowest-wage workers—dishwashers, busers and other kitchen staff.
“Speaking to people in the restaurant business, nobody had ever offered benefits before. It was a brand-new world,” McMann-Oliveri said.
She brought the problem to her boss with a potential solution: BeneStream, a software company that helps employers enroll low-income workers in Medicaid.
A confluence of three Obamacare attributes has strengthened 4-year-old BeneStream's ability to score financing from investors and land new clients. The healthcare law requires companies to insure their workforce or face fines. Individuals face penalties come tax time if they don't get covered. The third feature is the expansion of Medicaid in 31 states, including New York, to cover people who earn up to 138% of the federal poverty level, or about $33,500 for a family of four.
The scope of the employer mandate to provide health insurance to workers will be even greater in January 2016. Companies with 50 or more staffers will be required to offer coverage to 95% of full-time employees and their dependents up to age 26. The penalty for noncompliance is about $2,000 for each full-timer, although the fines exclude the first 30 employees.
The new requirement puts companies in low-wage industries such as hospitality and home healthcare in a bind. They must offer benefits packages that serve the needs of their high-level executives, but at the same time give low-wage workers access to an affordable health plan.
“Employers are in a difficult position because they're being asked to cover a pretty high portion of the population,” said Mary Clark, practice leader at Cammack Health, a Manhattan benefits consultant. “You may offer rich coverage and it's not affordable to everyone you cover.”
That's a gap that BeneStream exploits. The Meatball Shop is entering its second year of using BeneStream. Every month, McMann-Oliveri provides a list of employees who might be eligible for Medicaid. Bene-Stream contacts the workers, who gather documents, such as rent stubs and children's Social Security cards, and use the company's software to apply for Medicaid. A multilingual call center helps with the application. About 10% of the restaurant chain's 340 employees used the service last year, Ms. McMann-Oliveri said.