The Affordable Care Act, also known as Obama Care, is a system of health insurance reforms that share the goals of helping uninsured individuals to obtain affordable, quality health care. The aim of these laws is to encourage small companies to offer health insurance and motivate health insurance market changes. King Agency in Toledo OH offers the following advice on how to make sure that your company stays compliant with the changing health care laws.
Health Care Statistics
Obama Care has been successful in helping over 16 million uninsured people gain health coverage and over 10 million people pay their premiums. Medicaid coverage is expanding, patient safety has increased and uncompensated hospital care rates are lower. However, while overall health inequality is improving, ObamaCare does create certain problems and disadvantages for companies.
There are documented disadvantages to ObamaCare. ObamaCare poses an employee mandate burden that raises the costs of employer-sponsored coverage. This has caused some companies to cut employee hours in order to stay profitable. There are also many complicated and confusing health care laws that come with hefty penalties for noncompliance. If needed, be sure to consult with an employee benefits company for assistance.
Understand the Basic Facts
The Affordable Care Act is broken up into provisions that apply for different types of companies, such as companies with fewer or over 50 employees. Companies that have fewer than 50 employees are exempt from penalties and may qualify for health care tax credits. Keep in mind that there are steep penalties for companies that cross the 50 employee threshold and fail to conform to the applicable requirements. Any company with over 50 employees is considered a large business and required to offer health care coverage or pay a hefty penalty. These companies are also required to report to the IRS the details of the offered employee sponsored health plans. Learn more about the compliance requirements for employers here.
Help from the IRS
According to the IRS, companies with 50 or more full-time employees must withhold and report an extra nine percent of employee wages. Larger companies may also be required to report the value of the health insurance coverage on W-2 forms. The IRS requires that an annual return report must be filed that states what specific health insurance plans are offered. Most importantly, any company that fails to offer adequately affordable coverage may be required to make payments. Small companies, with under 50 employees, may qualify for the Small Business Health Options Program (SHOP) that provides affordable insurance options. Companies should have a designated member of management, such as an HR manager, be in charge of overseeing ACA compliance.
To summarize, there are both pros and cons to Obama Care. King Agency in Toledo OH recommends that companies clearly understand their legal requirements in order to maintain compliance with these new health care laws. A benefits administration assistance company will have the expertise to help companies stay compliant and avoid penalties. The Small Business Association (SBA) offers an overview of the new health care requirements here.