Health care law could cost UNC system $46M

After years of having its budget squeezed by state budget cuts and rising enrollments, the University of North Carolina system now faces a potential $46 million hit from the Affordable Care Act.

Starting next year, large employers must provide insurance for all employees who work more than 30 hours a week. The UNC system has 8,586 visiting professors, graduate assistants and others who meet that threshold but don't qualify for coverage under the State Health Plan because they are considered non-permanent employees.

Under the Affordable Care Act, the university system would have to provide insurance to all of those workers. The average cost of state health insurance is about $5,400 per year, bringing the total potential cost to $46.4 million.

"This is an unfunded mandate that's coming down on us," said Charlie Perusse, chief operating officer for the UNC system and a former state budget director.

UNC administrators say they might reduce the hours for many of the temporary workers to fewer than 30 per week to dodge the health care law's coverage requirement.

"We're (also) going to seek legislation from the General Assembly that would allow us to create a more cost-effective health care plan that still meets ACA coverage requirements but would cost us about $2,000 less per employee," Perusse said.

Gov. Pat McCrory said the UNC impact is another example of the troubles with the health care law.

"The implementation of Affordable Care Act does have some very negative consequences on government operations in addition to the private sector," McCrory said.