Affordable Care Act:

Transcription

1 Affordable Care Act: What every Business Owner needs to Know Critchfield, Critchfield & Johnston 60 West Second Street Ashland, Ohio Central Ohio Group Ins. Agency 136 E. Main Street Ashland, Ohio Whitcomb & Hess 1020 Cleveland Avenue Ashland, Ohio

2 (Brief) History of Obamacare Enacted (With Regulation to Follow) Impact Individuals, Employers, Insurers Timeline Phases of Implementation Past Challenges / Pending Challenges Constitutional and Coverage-related

3 Overview of Compliance Small Employers (< 50 FTE) No requirements to provide coverage; but notification Access to SHOP Exchange Access to Tax Credits (25 or fewer workers) Large Employers (50+ FTE) Must provide coverage or pay assessment Access to SHOP Exchange Coverage requirements

4 Employer Mandate Large employers with over 50 FTE are required to offer affordable, minimum value, and minimum essential health insurance coverage

5 Affordable Coverage is affordable if it costs less than 9.5% of an employee's household income Safe harbor: Form W-2 Rate of pay Federal Poverty Line

6 Assessments Large Employers not offering minimum essential coverage: Assessed $2,000 per FTE (reference exclusion) if at least one full-time employee receives incomebased assistance to buy coverage in the exchange. Larger Employers offering non-qualifying coverage: May be assessed the lesser of up to $3,000 per year for each FTE receiving income-based assistance, or, up to $2,000 for every FTE.

7 Other New Rules Discrimination Rules $100 per day penalty multiplied by the number of those individuals discriminated against. Notification Rules 1) Health Insurance Marketplace; 2) May qualify for a tax credit if they purchase coverage through Marketplace; and 3) May lose the employer contribution (if any) if they purchase a plan through the Marketplace Enrollment Rules

8 Sole Proprietors (Individual Mandate) Must purchase qualifying insurance coverage May receive tax credit Penalties increase over time and based on an individual s income

9 Small Employers: < 50 FTE Notify Employees: 1) Health Insurance Marketplace; 2) May qualify for a tax credit if they purchase coverage through Marketplace; and 3) May lose the employer contribution (if any) if they purchase a plan through the Marketplace

10 Medium and Large Employers: < 50 / 100 FTE Determine whether to provide insurance or pay assessment Notification requirements

11 Large Employers: < 200 FTE Determine whether to provide insurance or pay assessment Notification requirements Special enrollment rules

12 General Counting Rules Full-Time Employees 30 hours /week in a given month or 130 or more hours / month Part-Time Employees aggregate hours /calendar month for all employees not full-time divided by 120 Example

13 Look-Back Period Measurement Period - Employer may select a look-back period to measure whether employee worked an average of 30 hours per week. Stability Period - If employee worked average of 30 hours per week during the measurement period, employer must consider the employee a full-time employee during the subsequent period

14 Counting Employees Ongoing Employees New Hires Seasonal Employees Common Control

15 Tax Considerations Small Business Health Care Tax Credit Reporting Employer Provided Health Coverage in Form W-2 Additional Medicare Tax Information Reporting on Health Coverage by Employers

16 IRS Forms 1095-A 1095-B 1094-B 1095-C 1094-C Changes to 1040

17 State Exchanges/SHOP How They Operate Who Can Access

18 Insurance Products Essential health benefits Limits for HSAs Gold / Silver / Bronze Plans Self Insured Plans Grandfathered Plans

19 What we are seeing in the Marketplace

20 Action Items Determine your number of FTE and whether there are actions you may take to reduce the FTE number below the 50/100 FTE threshold Regardless whether you are over 50/100 FTE, all employers need to determine whether they will provide insurance If over 50/100 FTE, you should make the pay/play analysis Determine whether you qualify for the tax credit for employer premiums paid, if less than 25 employees Do affordability testing and analysis to determine if an employee s cost exceeds 9.5%, AND is that good or not depending on their situation If employers do provide insurance, determine where to purchase that insurance through exchanges or through agent Employers with group health plans need a plan document and summary plan description that is tailored to their business and employees

21 Contact Information Clint Bailey Critchfield, Critchfield & Johnston 60 West Second Street Ashland, Ohio Jim Hess Whitcomb & Hess 1020 Cleveland Avenue Ashland, Ohio Matt Tharp and Gina Ashley Central Ohio Group Ins. Agency 136 E. Main Street Ashland, Ohio