The Affordable Care Act – Employer Sponsored Health Insurance
In my first article I talked about how to determine whether your company would be covered by the employer mandate (“Play or Pay”) of the Affordable Care Act (“ACA” aka Obamacare). The “play” portion of the ACA mandates that qualified “large employers” (discussed last month) either provide a “qualified” employer-sponsored health insurance plan for full-time employees or “pay” a penalty of $2,000/year per non-exempt full-time employee which will begin to be assessed at the rate of $166.67/month per full-time employees over 30, beginning on January 1, 2014. This article will address the requirements for employer sponsored health plan to be “qualified.”
When determining whether to “play” or pay the associated penalty the determination will rely, in large part, on whether the cost of providing a “qualified” health insurance plan will exceed the cost of the potential penalties. In addition to the cost issue, you will also have to determine whether there will be other detrimental effects, like decreased workplace morale; employee retention if you were to drop your existing plan (which may not be conforming); your ability to recruit new quality employees if you do NOT offer health insurance; or, even the risk of unionization of your workforce if you do not provide the health benefits.