Things Every Business Should Know About Health Reform

Things Every Business Should Know About Health Reform

PPACA Individual Mandate Upheld by Supreme Court
On June 28, 2012, the U.S. Supreme Court issued a 5-4 decision ruling that the mandate for every American to have health insurance was constitutional. This means that beginning in 2014, everyone will be required to have health insurance, either through a government-sponsored plan, their employer or by purchasing it individually. Those who choose not to carry insurance will have to pay a penalty or a tax, (what to call it is still being debated), of $95 or 1% of your income, whichever is greater. If in 2016 you still don’t have insurance, the amount increases to $695 per adult and $347 per child, up to $2,085 per family or 2.5% of your income, whichever is greater.

Tax Credits for Small Employers
Employers with fewer than 25 employees and average annual wages of less than $50,000 may claim a tax credit for the cost of providing insurance which begain with 2011 tax returns.

Health Care Premium Use
For small employer and individual health insurance plans, at least 80% of all premium dollars collected are spent on health care services and health care quality improvement. 85% for large group plans.

Employer Play or Pay
Beginning in 2014, employers with more than 50 employees will pay a per-employee penalty fee if they do not offer health coverage or if they offer coverage and at least one full-time employee receives a premium subsidy.

Requirement to Inform Employees
Beginning in 2013, employers must provide each employee with written information on the employer health plan, health exchanges, available subsidies for insurance and how to purchase insurance.



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