It is important for employers to know where to begin in the months and years ahead with healthcare reform. Focusing on the right things for your business and your employees is essential in healthcare coverage. It may involve changing the processes as well as updating documents and materials to comply with the new law.
Many of the components of the healthcare law are beginning to unfold. When they signed it into law, they only signed a concept. The rulings and how things will actually work are still being determined by the federal government as we move along. Some people believe this gave the government the opportunity to bypass the steps needed to make other portions become a law. A nice way to get their way without asking for permission.
The number of employees will determine what action or actions you will need to take. The law uses a magic number of 50 employees as a bench mark. If the company has 49 or less, many of the laws do not apply to them. If you are 50 or more, there are more requirements that are required for those businesses.
The government did get smart with this benchmark of 50 employees. They are using what they call "Full-time equivalent" employees. They take the number of hours worked by all of the part-time employees and divide by 120 hours. This will give you a total for Full-time equivalent employees and is added to the full-time employee numbers.
For groups filing 250 or more W-2 forms are required to report the cost of employee's health insurance coverage on the employees. At this time, this reporting is only informational for the employee and will not have to pay any taxes on this benefit. Some employees will be in shock and will treat their job with more respect. Others will not care and take advantage of the system even more.
A tax credit is a perk for small businesses will help them with their employee benefits. The Small Business health Care Tax Credit was put in the law to encourage small business owners and tax-exempt organizations to offer health insurance coverage for their employees. Some businesses will not think this is enough incentive. For those business owners on the fence in providing benefits, or already do, this is icing on the cake. In 2014, the tax credit will be only available through the Small business Health Options Program (SHOP). At the time of this writing, the SHOP has been delayed.
A number of taxes and fees related to the healthcare law will change the game plan for employers. Some of them will have a dramatic impact on the groups premiums. Having an idea on where the fees are going to and effective dates will allow you to make business planning a little easier.
Health Insurance Exchanges, or Marketplace, could change how businesses cover their employees in the future. As an employer, you are required to provide all employees with information about the Exchanges. This will include the employee eligibility to participate in the Exchanges and the health insurance subsidies if the the group coverage provided by the employer is considered unaffordable by the Affordable Care Act's guidelines.
Business owners and employees are not required to buy inside the Exchanges. There maybe some perks, however, some of those perks may not be eligible for the business. Buying outside of the exchange maybe a more viable option for businesses.
Small businesses will be required to implement changes within the plans they offer. The coverage changes will be based on benefit expansion or coverage limits. These changes will affect groups small and large. Your current carrier will inform you of these changes.
The out-of-pocket limits on the plan cannot exceed the limit as outlined by the Health Savings accounts (HSAs). Those of you that have an HSA currently, this may be no news for you.
Essential Health Benefits and Minimum Essential Coverage is a key part of the expansion. These are benefits like maternity, preventative medicine coverage, etc. This could be a good or bad thing for the group. Although the plan will have more benefit, the premium will reflect the cost of the coverage.
All in all, when you add more 'benefit' to a plan, the cost of that plan could only go up. There are some good things that came out of this law, but not everything. Businesses have to watch where their dollars are going with the new healthcare law. They are not required to be experts on the law, but stay informed. Having basic knowledge will help you move forward in the years ahead for providing employee benefits for the company.
Butch Zemar
www.EliteBenefits.net