ALPHARETTA, GA - For employers who have adopted a wait and see approach with the Patient Protection and Affordable Care Act (PPACA) the time to wait is over. 2013 now becomes a critical planning year with strategies around cost containment and compliance. This should be a key focus for green industry employers to get a hold of before this fall.
Don’t panic! Employers and employees don’t have all the cost and plan design options yet. This will drive decisions! Here are some facts and myth busting ideas to consider:
The first step is to get a handle on the elements of the legislation so you can begin to formulate a plan on how to navigate. Under the law, businesses with 50 or more full-time employees are considered a "large employer” and thus must provide health insurance to all full time employees. Employees are considered full-time if they average 30 hours per week or more. As a large employer you can be subject to penalties for not providing qualified health coverage to your employees at a penalty rate of $2,000.00 per year for each employee ( minus the first 30). For example, if you have 70 full time employees and offer no coverage, then you are liable for 70 less the minimum 30 requirement- that’s 40 people times $2,000 or $ 80,000! Clearly a large number! If you are under 50 employees then you get a pass from providing coverage, but beware of strategies like these to minimize head count.
But, even if you have less than 50 employees, you must begin to document hours and do the calculations under the federal rules this year to demonstrate that you, in fact, have less than 50 employees going into 2014.
Key Planning Items
The key planning items for most "large” employers who are required to provide coverage is to understand plan design, minimum essential benefits, and employee contribution limits.
Lastly, every employer should conduct a financial analysis and plan design offering this spring and summer. Work with your consultant, lawyer and insurance broker to create the right strategy for you and your team. Finally prepare communication to share with your staff so they are educated on options both from a benefits and cost perspective. This is too big to screw up! Get it right!
For more information on planning for the PPACA, click here.