Nearly 200,000 Houstonians signed up for health insurance through the federal Health Insurance Marketplace by April 2014 following the implementation of the Affordable Care Act.

However, as the employer shared responsibility mandate is set to affect businesses in January, more than 1 million residents are still uninsured in the Greater Houston area. With open enrollment scheduled to begin Nov. 15, the ACA will continue to mold and reshape health care in the region in 2015.

"[This] is a transformational time in health care—some related to the Affordable Care Act and some related to awareness of health care outpacing inflation and people's income," State Rep. John Zerwas, R–Richmond, said. "It is a time of uncertainty in health care, but it is also a time of new opportunity and excitement as we look at new ways to provide health care coverage and delivering quality, efficient care."

Employer mandate

Starting in 2015, the employer shared responsibility mandate requires employers of 100 or more full-time equivalent employees—or employees that work an average of at least 30 hours per week—to provide health insurance coverage to 70 percent of all full-time workers, according to the Treasury Department.

Midsized employers of 50-99 full-time equivalent employees are already preparing for the same challenge as the mandate for employers of that size goes into effect on Jan. 1, 2016.

Andrew Malahowski, area senior vice president compliance counsel for Gallagher Benefit Services, which has offices in The Woodlands, said employers that do not offer coverage are forced to pay a $2,000 penalty for every full-time employee that is not offered coverage. Employers that offer coverage that does not meet the ACA's minimum requirements are subject to a $3,000 fine for every employee who receives a premium tax credit through the Health Insurance Marketplace, he said.

Malahowski, who represents about 5,500 employers across several states, including Texas, said employers in the Greater Houston area are concerned about the effects the mandate could have on their businesses.

"I would say that compliance issue more than any other is at the forefront of our clients' minds," he said.

Although Malahowski said many of his clients already offer health insurance to their employees, there is some concern about the costs of ensuring those part-time employees who work 30-plus hours per week and are now designated as full-time employees by the ACA.

"It may be the case that a lot of our clients offer insurance to somebody, but the question is do they offer insurance to all employees considered full time by the Affordable Care Act," he said.

Malahowski said offering coverage to an employee is likely going to be more expensive than the $2,000 fine to not offer coverage at all. It is possible to offer coverage plans that would cost less than $2,000, but it might not meet all the requirements of the ACA. Some employers are being faced with making tough business decisions of whether to cut employees, hours or insurance coverage, he said.

"If an employer is exposed to tax penalties that they never had before or they have to offer coverage they have never had to before, that affects the employer's bottom line, and whenever the employer's bottom line is affected, they will have to make business decisions," Malahowski said. "We've seen some employers who have attempted to restructure their workforces to attempt to meet the rules. But it is more of a hypothetical at this point."

Sergio Espinosa, owner of La Escondida Grill in Missouri City, said his business was doing well enough to open a second location in the region, but the upcoming employer mandate caused him to change his plans.

"Business has been good, and we were looking at a possible second location," he said. "We decided just to focus more on local catering."

Under the ACA, employees of businesses that are under common control are combined to determine whether an employer employs 50 or more full-time employees.

Espinosa said many of his employees work full time and have been with his restaurant since he first opened in 1999.

"Businesses need to ask what the benefit structure looks like for their employees," Zerwas said. "It is going to be a business-by-business decision."

Health care providers

After one year under the new rules of the ACA, health care providers in the Greater Houston area are seeing change in the health care industry.

"With the Affordable Care Act, it really was that three-pronged approach to cover the uninsured, bend the cost curve and redesign the way we deliver care," said Rosie McStay, director of government relations and community benefits for Texas Children's Hospital, which has a hospital in Katy and one planned for The Woodlands.

McStay said the legislation's removal of lifetime caps for insurance coverage helps families that may need to pay for extended periods of critical care. She said the removal of pre-existing medical condition clauses has also improved health care coverage for Texas residents.

"[Previously] if a baby has surgery and a congenital heart defect is fixed, it would still be considered a pre-existing condition even in their teenage years and going into adulthood," McStay said. "Now that is no longer the case. Now [patients] can get health coverage that they would not have been able to [get] because it was so cost prohibitive to do it in the past."

Staff at AccessHealth, a nonprofit clinic that serves residents throughout the Greater Houston area, have seen significant changes in trends since the ACA has gone into effect.

"We are seeing increased traffic, typically those who could not get on a plan [through the ACA]," said Cindy Reaves, director of marketing and development with AccessHealth. "About 70 percent [of people] did not qualify, and only 11 percent because of citizenship status. For that gap of people, they think there is nothing for them."

Reaves said her staff is seeing more low-resource patients who are generally sicker as a result of the lack of health care resources. AccessHealth saw more than 40,000 patients last year and provides health care services on a sliding price scale based on a patient's income. Although not all specialty cases such as cancer can be treated, the clinics around the region provide comprehensive care for most cases.

Steve Sanders, former CEO of Memorial Hermann The Woodlands Hospital, said the biggest challenge to health care following the ACA is how many consumers actually buy health insurance as the cost of copayments and deductibles rise.

"Just because [consumers] may get an insurance policy that has a $150 a month premium, as an example, they may be able to afford that, but if they have to go to the hospital and be admitted and have surgery and they got a $5,000 deductible, how are they going to pay for that?" Sanders said.

As consumers struggle to pay for rising health care costs, Sanders said it places a strain on health care providers, who are trying to collect that money.

Serving Houston area residents

The number of uninsured residents in Harris County tops 1.1 million people, said Porfirio Villarreal, public information officer for the Houston Department of Health and Human Services. However, Villarreal said the number should continue to fall as people become more accustomed to the process of enrolling every year.

"Most people will qualify for some subsidies to help them enroll," he said. "Because they are low-income, they will get assistance in paying for those premiums."

The ACA could be beneficial to the low-income population in the Greater Houston area, but there is still the obstacle of the Medicaid expansion dollar, Zerwas said.

"The Affordable Care Act did hinge on Medicaid being expanded and providing coverage for a group of people there is not a solution for," Zerwas said. "Texas was one of the states that did not opt to do that for a variety of reasons."

Zerwas said there needs to be a more coordinated way to provide health care. His district has seen recent growth due to growth in the energy sector. In addition, several health care facilities have moved to the area and a majority of his constituents have good jobs that offer reasonable insurance.