Mandates, Reporting, and Taxes To Impact Large Employers
You are generally considered a large employer if you have 50 or more employees, whereby you must offer minimum coverage to all of your full-time workers or pay penalties. Even though part time and most seasonal workers are included in the FTE calculation, you are only required to offer coverage to full-time salaried and hourly workers.
The law does not require employers to provide health insurance to employees, but starting in 2014, large businesses that do not provide health insurance will be required to pay an assessment if their employees receive premium tax credits to buy their own insurance. These assessments will offset part of the cost of these tax credits. The assessment for a large employer that does not offer coverage will be $2,000 per full-time employee beyond the company's first 30 workers.
Some operators are finding that the cost of offering coverage to all full-time employees exceeds the cost of penalties for failing to do so. This could lead some businesses to consider offering less, not more, coverage. At the same time, some operators are considering the 50-FTE thresholds in deciding if they want to expand their businesses or hire more workers.
ORLA has partnered with Garth Rouse & Associates to develop frequently asked questions (FAQs) related to large employers and the Affordable Care Act (ACA). Before implementing any benefit changes, consult a professional specializing in this field as this law is continuously changing and evolving.
To avoid penalties, the coverage would need to be deemed “affordable” which requires that employees pay no more than 9.5% of their income to those premiums. You would be required to pay the difference. The carrier may also have a required minimum you must pay towards the premium.
Grandfathered Health Plans
The Affordable Care Act exempts most plans that existed on March 23, 2010 — the day the law was enacted — from some of the law’s consumer protections. This preserves consumers’ rights to keep the coverage they already had before health reform. Read more at HealthCare.gov
Form W-2 Reporting
The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan, however, reporting the cost of coverage on the Form W-2 does not mean that the coverage is taxable. In general, the amount reported should include both the portion paid by the employer and the portion paid by the employee. Read more at IRS.gov