The Affordable Care Act (ACA) has made some extensions to its employer mandates, but January 2015 is fast approaching. The best way to benefit your company is to prepare now for what’s coming so you are in full compliance with the required health insurance changes.
To remind you of the basics:
- The mandates stated that as of January 2015, according to the Obamacare Facts website, businesses with over 50 full-time employees (FTEs) had to provide health insurance for them or pay a per-month “Employer Shared Responsibility Payment” on their federal tax return.
- Note that a further update now states that small businesses with 50-99 FTEs must insure workers as of 2016. Any employer with 100 or more FTEs must start providing healthcare benefits to at least 70 percent of those employees by 2015, 95 percent by 2016.
- Paying the Employer Shared Responsibility Payment in lieu of health insurance can cost from $2,000 to $3,000 per employee a year, and none of that payment is tax-deductible.
It will help you to stay ahead of the curve and prepare – while the extension does exist, the smoothest transition for your company includes a focused implementation plan to help you remain on track and successful, long term. You have a few points to consider:
- Figure out how many employees will qualify as full time, whether health plans are also available for your full-time temporary employees, and how many of those people will participate in the plan.
- Determine what your company will need to contribute to make the plan affordable to your employees.
- Understand that you cannot require an employee to pay more than 9.5 percent of his W-2 income for his part of the premium, as per the IRS.
- Figure out who will be enrolled in Medicaid, which can reduce costs to you.
- You may consider cutting some employees back from 30 hours a week so you have fewer technical full-time employees, but take care with this: You may risk discrimination liability if you use this as a tool to cut down on your own expenses, and have to make restitution to the employees, as well as reinstating them back to full time.
As a company, you must offer affordable care to your full time employees, and there’s no one way to make this viable for both yourself and your workers. Plan now for how best to implement the upcoming health care policy and make sure you stick to your implementation so everyone can benefit over time. Work with the experienced staffing partner, PrideStaff Thousand Oaks, to create the smoothest transition.