Newsflash: Firms See Opportunity in Health Law | AccountingWEB

Newsflash: Firms See Opportunity in Health Law

Early this year, officials at Littler Mendelson, the largest U.S.-based law firm representing management in employee benefits and labor law, surveyed the landscape as the Obama administration began implementing the Affordable Care Act. They knew big money was to be made.

CPE Link Healthcare


Watch Full Newsflash


Businesses large and small were grappling with how – or even whether – to comply with the new federal mandates for providing health insurance to full-time workers. Many feared the costs would be staggering and could put them at a competitive disadvantage or drive them out of business.

Littler Mendelson responded by forming a separate health care consulting group with over 20 top attorneys to advise clients on how to minimize their costs and taxes. The giant firm – with more than 900 lawyers operating from 55 offices nationwide – also created an online service to help companies determine liabilities and costs under Obamacare. New business started pouring in.

“We’re advising hundreds and hundreds if not thousands of businesses,” Steven Friedman, co-chair of the firm’s employee benefits practice group, told The Fiscal Times. “We’re working with employers to determine if there are strategies they can employ to somehow mitigate the effects of the law . . . and we’re coming up with some innovative solutions.”

This strategic expansion is part of a cottage industry thanks to the new health-care reform law. President Barack Obama signed the law in March 2010, but it won’t fully take effect until January. With a new slew of complicated laws and regulations on the books, someone has to interpret them for average Americans and the business community.

Leading law firms like Littler Mendelson, Proskauer and others continue to eye the possibilities. H&R Block and other tax preparation firms are expected to hire additional accountants to help individuals file their tax returns, which will provide vital information to comply with Obamacare. And certified public accounts and data management firms are poised to assist businesses with record keeping and other assistance.

Without question, tax professionals and tax form preparers are among the most important cogs in the Obamacare machine. That is because the IRS, rocked by political scandals in recent months, is central to implementing the health care reform system.

The Supreme Court held last year that Congress could regulate health care under its ability to tax. That gave the IRS a leading role in implementing the new law, along with the Department of Health and Human Services. There are 47 tax provisions – including the small business health care credit and the medical devices tax – that will take effect. The agency will have to administer those provisions and collect taxes where due.
• The IRS determines whether people qualify for a health insurance premium tax credit as part of the minimum coverage requirement.
• Americans will report their insurance status when they file their tax forms.
• The IRS will collect a $95 penalty on those without insurance.
• Businesses with 50 or more full-time workers must provide health care insurance to their employees or face a $2,000 per-head penalty.
• The agency will collect the penalties when businesses do not comply.

Tax preparers play such an important role in Obamacare that HHS Secretary Kathleen Sebelius reportedly solicited a $500,000 donation from H&R Block to fund a marketing campaign to sell Americans on health reform. Gene King, a company spokesman, said yesterday that while Sebelius contacted H&R Block, the firm had yet to commit to any donation.

H&R Block CEO Bill Cobb said last week in a conference call with investors that the company has “begun to invest in resources and technology that we expect will enable us to roll out initiatives this year that will benefit our clients.”

The potential for revenue growth by H&R Block and other tax-prep firms is tremendous. The tax preparation industry generated $9 billion in revenues in 2012 while employing 302,931 people at 109,758 firms, according to IBIS World. Hundreds of millions of dollars or more could easily be generated by those companies’ outreach on Obamacare.

Some accounting firms that don’t directly advise on the new health insurance law still stand to make a lot of money because of it.
Peisner Johnson & Company, a Dallas-area certified public accounting firm, specializes in handling companies’ state and local sales tax obligations. Because many firms are trying to keep their workforces below 50 employees, they are outsourcing some work – including handling sales tax records and payments.

Many Texas companies are outsourcing that work to Peisner Johnson, says Michael Fleming, the firm’s director of partner relations.

“Our out-sourced state and local tax returns business is growing by leaps and bounds,” Fleming told The Fiscal Times. “I’m not looking at exact figures here, but I would say year over year we’re probably up 20 percent this year.”

Source: Wall
Content provided by iShade

This blog

by Sue Anderson - Based on 30 years of experience in continuing education for accountants. Currently program director for online CPE provider, CPE Link. Formerly with the California CPA Education Foundation managing key operational areas including marketing, program development, and distance learning.

More from this blog

Bloggers crew

Steve Knowles has spent 25 years in business and practice in the UK, but he also worked in the states and the years haven't dulled his way of seeing an alternative view to everyone else, and every day is a new adventure.


Joel M. Ungar, CPA is a lifelong resident of the Detroit area and a graduate of The University of Michigan. He is a principal with Silberstein Ungar, PLLC, a Top 15 auditor of SEC public reporting companies.


Allan Boress, CPA, with over 25 years as a practitioner and consultant to the accounting profession. Mr. Boress is the author of 12 published books in 6 different languages, including a best-seller, The "I-Hate-Selling" Book.


Larry Perry, CPA, CPA Firm Support Services, LLC, is the author of accounting and auditing manuals, author and presenter of live staff training seminars, and author of webcast and self-study CPE programs. He blogs about small audits, reviews, and compilations.

Sandra Wiley, COO and Shareholder, is ranked by Accounting Today as one of the 100 Most Influential People in Accounting as a result of her prominent role as an industry expert on HR and training as well as influence as a management and planning consultant. She is also a founding member of The CPA Consultant's Alliance. Sandra is a certified Kolbe™ trainer who advises firms on building balanced teams, managing employee conflict and hiring staff.

Maria Calabrese, CIR, Human Resources manager for Fazio, Mannuzza, Roche, Tankel, LaPilusa, LLC in Cranford, New Jersey, Maria's topics revolve around the world of: Mentoring, Performance management, and The "Y Generation," a.k.a. "The whY generation".


William Brighenti is a CPA, Certified QuickBooks ProAdvisor, and Certified [Business] Valuation Analyst, operating an accounting, tax, and QuickBooks consulting firm in Hartford, Connecticut, Accountants CPA Hartford.


Ken Garen, CPA, is the co-founder and President of Universal Business Computing Company (, a software development firm of high-volume, high-productivity accounting and payroll technology.


Eva Rosenberg, MBA, EA, is the publisher of, and author of the weekly syndicated Ask TaxMama column. She provides answers to tax questions from taxpayers and tax professionals worldwide.


Amy Vetter, CPA, CITP is the CPA Programs Leader for Intacct Corporation responsible for leading the CPA/BPO Partners nationally.

Brian Strahle is the owner of LEVERAGE SALT, LLC where he provides state and local tax technical services to accounting firms, law firms and tax research organizations across the United States. He also writes a weekly column in Tax Analysts State tax Notes entitled, "The SALT Effect." For more info, visit his website:
Scott H. Cytron, ABC, is president of Cytron and Company, known for helping companies and organizations improve their bottom line through a hybrid of strategic public relations, communications, marketing programs and top-notch client service. An accredited consultant, Scott works with companies, organizations and individuals in professional services (accounting, finance, medical, legal, engineering), high-tech and B2B/B2C product/service sales.

Rita Keller is a nationally known CPA firm management consultant, speaker, author, mentor and blogger. She has over 30 years hands-on experience in CPA firm management, marketing, technology and administrative operations.

Stacy Kildal is the mom of two fantastic kids, an Advanced Certified QuickBooks ProAdvisor, Certified Enterprise Solutions ProAdvisor, Sleeter Group Certified Consultant, a nationally recognized member of the Intuit Trainer and Writer Network, and co-host of RadioFree QuickBooks.
Michael Alter's blog specializes in providing practical advice to those who seek greater profitability and practice management tactics that enhance deeper client relationships.

Sally Glick, CMO, Principal, Marketer of the Year in 2003 and AAM Hall of Famer in 2007, leads a lively discussion of the constantly expanding roles of marketing and the professional marketers that drive this initiative in accounting firms of all sizes.


The IMA Young Professionals Blog features the insights of IMA’s Young Professionals Committee. Committee members share advice and experiences on careers, continuing education, work/life balance, and other issues affecting young accounting and finance professionals.


FEI Financial Reporting Blog provides highlights from SEC, PCAOB, FASB, IASB, and other regulatory news, including reporting under Sarbanes-Oxley Sect 404. It is written by Edith Orenstein, Director of Technical Policy Analysis at FEI.


Sue Anderson has 30 years of experience in continuing education for accountants. Currently she is the program director for online CPE provider CPE Link.


Jim Fahey is COO of Apple Growth Partners, a regional CPA firm in Ohio. His focus is on the effective and efficient use of technology within the firm by all team members.

Caleb Newquist is the Editor-in-Chief of Sift Media US, overseeing content for both AccountingWEB and Going Concern.

Leita Hart-Fanta, CPA, CGFM, and CGAP is the author of "The Yellow Book Interpreted" and owner of a website devoted to training for governmental auditors.


AccountingWEB is more than just a U.S. team of journalists and financial and technology experts - we have an international side, too! Members of our British team who publish share their ideas, insights, and perspectives from across the pond.