New Business Alliances
There may be an upsurge in the creation of small employer organizations and virtual companies that intentionally remain exempt from certain regulations under the 200 FTE benchmark set by the PPACA. These smaller companies are likely to partner with other small employers in the US and with outsourcing service providers wherever possible.
A New Outsourcing Trend Emerges
A number of US companies are turning to outside providers for expert counsel and services that can help their businesses operate more efficiently, while reducing overhead costs and minimizing legal risk. In particular, service offerings in the administration of healthcare insurance, healthcare funding, corporate human resources, and litigation outsourcing disciplines are in demand. Insurers and health plans are also looking to outsourcing as a way to relieve the pressures of cost control, regulatory compliance and operational efficiencies.
Increased Demand for Compliance and Employment Litigation Services
The mandatory US healthcare regulations may further encourage large global corporations to outsource or offshore all aspects of compliance and employment litigation associated with the PPACA. ObamaCare may accelerate the offshoring of both administrative tasks and high-level functions, such as R&D, market research, accounting and tax administration, contract management, e-discovery, litigation support, and more.
Increased Need for Legal Process Outsourcing
The PPACA could increase demand for e-discovery and LPO (LPO) services. Because the Act creates new entitlements and protected classes of employees, there will likely be new class action and general litigation matters. Two provisions of the law are of particular interest:
• The PPACA creates new civil rights which can be enforced through class actions. “Employees may not be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, or under any program or activity that is administered by an Executive Agency or any entity established under ACA. Sec. 1557, extending civil rights under title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.), title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et seq.), the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), or section 504 of the Act of 1973 (29 U.S.C. 794).”
• Additionally, the PPACA adds whistleblower protection for “employees who report to their employer, the federal government or a state attorney general, any violation of, or act or omission that the employee reasonably believes to be a violation of, the law. Similar protection is granted for an employee’s right to object to, or refuse to participate in, any activity, policy, practice or assigned task that is or is reasonably believed to be such a violation. ACA, Sec. 1558.”
These challenges and opportunities may be the tip of the iceberg for US companies looking to comply with the PPACA. As each new compliance deadline approaches there will likely be new issues and trends that arise which may have an impact on the outsourcing industry. One thing is almost assured - the next decade will be full of uncertainty and change.
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