The Impact of The Healthcare Reform On Employers

Let me start this off by making it very clear that the jury is still out on this issue. I am not even sure if the politicians who voted for this are completely sure of the all of the different aspects of this new law.  The following information was gathered from several different sources. I am providing it to you with the understanding that I am not an authority on this but I am trying to at least get you some generalized information.

As I understand it, beginning in 2014, the new law will require an employer with more than 50 full-time employees  to pay $2,000 per employee if the employer fails to offer health coverage and has at least one full-time employee receiving a premium assistance tax credit or cost-sharing reduction. The first 30 employees of the employer will be excluded from the calculation of the  penalty. If the employer has 80 employees the fine imposed would be $100,000.

With respect to a more well known feature of the law, beginning in six months, health plans that provide dependent coverage will be required to provide it up to the age of 26 (just when we thought we had gotten ride of these child dependents!). It also includes coverage for pre-existing conditions. Starting in 2014, this provision will apply to all people. The legislation will also require that employers with more than 200 employees automatically enroll full-time employees in healthcare coverage. The provisions will allow employees to opt-out of the coverage after the automatic enrollment period.

For small businesses that choose to offer healthcare coverage to employees, the guidelines of the new law will offer tax credits (up to 35% of the premium) beginning in 2010. The full credit will be available to companies with 10 or fewer employees with average wages of $25,000. The larger employers will see the smaller credits. There are also some areas of the law that ban certain past practices. Effective six months from now the law prohibits insures from imposing lifetime limits on benefits, and there will be no more discrimination in favor of higher paid wage employees. Federal law will now require employers to provide unpaid breaks for new mothers to express breast milk. California had already passed this law several years ago (Lactation Accommodation).

There are other provisons that are not slated to begin until 2014 and later. I wanted to at least get you some of the new guidelines that will have a more immediate impact as well as some of the more controversial points. Good luck to us all on this one.