PhillyDeals: AmEx reducing some charges

American Express isn't advertising this, but it is quietly cutting the rates it charges small businesses and restaurants.

The New York charge-card giant has picked JetPay Corp., a Berwyn-based company set up by former MAC Card boss Bipin Shah, as the first payment processor licensed to offer AmEx cards at a price competitive with Visa and MasterCard, but less than it charges big stores.

Under a program AmEx is internally calling "Opt Blue," AmEx is using JetPay and at least one other processor to offer small merchants, who handle less than $1 million in AmEx billings a year, a fee below its typical 3.5 cents or more on every dollar the customer spends, and more on a level with Visa and MasterCard, which typically clip 2 to 2.5 cents.

AmEx has given its blessing but doesn't want to talk about details of the program since "it is still early days," AmEx spokeswoman Sanette Chao told me.

Philadelphia law firm chief and ex-bank president Alan Fellheimer was one of the many small-business owners who got word from his insurer last week that his employer health plan won't be renewed when it expires early next year.

"Every small law and accounting firm I have spoken with who carries a group plan with Blue Cross-Blue Shield is receiving the same notice, [and been warned the typical replacement plan] will be materially more expensive," Fellheimer told me. He wonders how many companies will end up canceling coverage and paying workers to buy their own.

It's happening to doctors, too: "We are a physician group with 36 employees. Our plan was also canceled," Dr. Stan Kofsky said, regarding his Abington practice. Kofsky says his group has been offered a new plan that costs 17 percent more than the old one.

He noted that his carrier, Independence Blue Cross, has repeated the government's claim that some replacement plans will cost more, some less. "I haven't heard of any going down," he told me.

"We do have products - 37 options - and have laid out pricing and other details for customers with renewal dates of Jan. 1," IBC spokeswoman Judiemarie Thomas told me. Replacement "Blue Solutions" plans are available and are being promoted in letters that started going out last week.

Will those, mostly, cost more? "In some cases, the rates for the new ACA-compliant plans will be higher than current costs, and in other cases they won't be," Thomas said, referring to the Affordable Care Act.

I asked the question another way: Does Independence expect the effect on its insurance revenue will be higher, or lower, as a result of the new law? Independence won't say: That's "proprietary information," according to Thomas.

Won't many small employers, facing higher rates, cancel coverage and pay employees more to buy their own? ACA taxes individual-plan contributions more heavily than group plans.

"Dropping employee benefits is not only a problem from an employee morale and productivity standpoint, it can also be more costly for the employee, due to taxation," said licensed health-insurance broker Carsten Pedersen, who runs the benefit consultant Patriot Benefits Group, of Hatfield.

The confusion makes middleman advisers such as Pedersen's firm useful to employers.

As President Obama has finally admitted, despite his earlier promises, "You can't keep your health plan," Pedersen concludes.

But yes, you can replace it. Though we're only starting to figure out how much that will cost.