Obamacare Effects: Employers


A reader writes…

Hi, Anita:

I am a small business owner with about 45 employees and have some questions about Obamacare. I have heard a lot of buzz about the subject but not much concrete information about the effects of its implementation. Can you help shed some light on how my business and I need to adapt to these changes in the law?

Dear, Unsure About Obamacare:Dr_Woman

The Patient Protection and Affordable Care Act, also known as Obamacare, has been on the minds of business owners and  managers across the country. Though the next round of changes isn’t scheduled to begin until January 1, 2014 (can you believe we are halfway through May already!), now is the time to get the facts straight and figure out what steps you need to take to prepare. Below are some basic points all employers and managers need to keep in mind:

  • The Affordable Care Act applies only to employers that have 50 or more employees or full-time equivalents. Because you have 45 employees, you will not be required to “pay” (a $2,000 penalty for each employee after the first 30 not covered by insurance) or “play” (and provide coverage for each of your full-time-equivalent employees) come 2014. However, if your business grows and you need to add 5 or more full-time employees, you will be subject to these rules. Note that “50 full-time-equivalent employees” means that the total hours among all full- and part-time employees equals the amount of hours worked by 50 full-time employees.
  • State exchanges will provide individuals and small employers (those with less than 200 employees) a marketplace to purchase group health coverage plans.
  • Comprehensive health plans used by employers to leverage employment deals and keep the best talent on staff are subject to an additional tax. In 2016, health benefits that are valued at $10,200 for single coverage or $27,500 for family coverage will be taxed at 40%.
  • If the health care plan you offer your employees is too expensive and exceeds 9.5% of their income, you will be subject to a hefty fine. This piece is a growing concern for employers like manufacturing firms, restaurants, and retail establishments that offer positions at a lower wage. Employers will be facing a penalty of $3,000 if the plan is deemed unaffordable or inadequate.

If your head is swimming, you’re not alone. It’s a complex law but an important one for everyone to understand, especially you as a business owner. Because I’ve also received questions about Obamacare from employees and job seekers, I’m going to be writing a series of posts on this subject over the next couple of weeks. So check back next Tuesday!

In the meantime, you might want to watch the video below, in which CNN medical correspondent Elizabeth Cohen explains which parts of health care have changed or will change soon as a result of Obama’s health care reform.

Stay well,

Anita

Have a question you would like to ask? Visit http://anitaclew.com/ask-anita/.

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4 Comments (+add yours?)

  1. Nakisha Hawthorne
    May 14, 2013 @ 17:19:53

    I Nakisha Hawthorne is seeking a long term job in Warehouse.I was wondering if you was able to locate me a job.I have a lot of hands on skills and have been working in warehouses almost my whole life.Thank you

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  2. John
    May 14, 2013 @ 14:17:22

    One of the most controversial provisions/regulations of “Obamacare” was not mentioned in your piece, and that is that any employer having 50 or more employees (in some versions, it is not even that), said employer is required by law to cover contraception medications (abortifacient) for their female employees. This is a very controversial provision for those employers who object to any sort of abortion, abortifacient, or contraception on religious/philosophical grounds. Feeling as they do that abortion is merely an euphemism for infanticide (the killing of children), they object to it on, as I have said, moral, religious and philosophical grounds and resent being compelled by law to do something they feel is indefensible morally. I am not an employer, but I fully agree with their objections. As of this writing there are multiple efforts in different states to mollify or eliminate this objectionable provision in “Obamacare.” One state has (I forgot which one at the moment), has enacted a state law which virtually eliminates that provision. The campaign for this provision’s elimination is ongoing as of this writing.

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  3. Brian Millison
    May 14, 2013 @ 08:33:19

    Anita; I thought this was the US???? Why is the public removed from voting on these issues?

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Anita Clew's blog posts are intended for general guidance and should never be taken as legal advice. In all instances where harassment, inequity, or unfair treatment is believed to be present, please consult your HR Department or legal representation.
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