The affordable care act or ACA is impacting employers and businesses different ways. Hear from our experts how the specifics of the ACA when it comes to offering health insurance the communication required and other obligations employers have or face hefty penalties. This webinar is eligible for HRCI recertification credit. Visit http://b4j.com/hrciwebinars & register to get PHR, SPHR & GPHR cert credits free.

1. Presented by
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2. Get HRCI Recert Credits
• Visit http://b4j.com/hrciwebinars
& register to get PHR, SPHR & GPHR cert
credits free.
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3. Our panelists
Jessica Miller-Merrell
Randy Peck
@blogging4jobs
Dir Software Strategy
Mike Haberman
@mikehaberman
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4. Message from the moderator
Jessica Miller-Merrell
@blogging4jobs
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5. 1200 pages of legislation
•
•
Employer Mandate and Employer
responsibilities
Individual Mandate
This a complex law with over 1200 pages of legislation
and many more pages of regulation. We are giving an
overview and nothing should be construed as legal
advice.
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6. ACA in the news
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7. ACA timeline of events
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8. Legislation key points
• Employers with 50 or more FTEs
• Fulltime employees (30 or more hours
per wk)
• The monthly sum of hours of employees
working less than 30 hours per week
divided by 120.
• Added together if the total is 50 or
more the employer is covered
• Includes working hours & compensated
hours
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9. Legislation key points
• Offer “Affordable” Insurance to full-time
employees or pay a penalty
• Provide written notice to employees at
time of hiring of what is provided (this
notice must be provided to current
employees by March 1, 2013)
• Provide W-2s with insurance values
• As of 2014, make annual reports to the
Secretary of the Treasury (more later)
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10. What “affordable” means
“Affordable” insurance is deemed
affordable if :
• The cost of coverage for employeeonly coverage is no more than 9.5% of
the employee‟s household W-2
income
• The insurance covers 60% or more of
the actuarial cost of the healthcare
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11. Key points
• Employers are NOT required to pay 100%
of the cost of coverage
• Employees can be required to contribute
to the cost of coverage in increasing
amounts based on increased income
• Employees can be required to pay the
full cost of dependent coverage
• Large employers are only required to
OFFER coverage and there is no penalty if
the employee declines.
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12. Message from Mike
Mike Haberman
@mikehaberman
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13. Employer Penalties
• They don‟t
provide any
insurance
coverage
• They provide
“unaffordable”
or “inadequate”
coverage
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14. Defining inadequate
• The cost is 9.5% of the employee‟s
household income
• Insurance doesn‟t cover at least 60% of
health costs
• At least one employee receives a tax
credit or subsidy to purchase insurance
through an exchange
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15. Employer penalties
The penalty is the lesser of:
• $2000 x the total number of full-time
employees
• Or $3000 X #full-time employees who
receive a tax credit or subsidy and
purchase through an exchange
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16. Calculating penalties
An employer has 100 FTEs of which 65 are
full-time employees. They only offer
insurance that covers 50% of coverage.
Ten employees qualify for a tax credit or
subsidy because they have incomes that
are below $44,680 (400% of the Federal
Poverty Level)
10 X $3000 = $30,000 fine
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17. Exchanges and employers
• Exchanges determine if individuals are
eligible
• Exchanges notify employers of full-time
employees who qualify for subsidy or
credit
• If employees have adequate coverage
they will NOT qualify for the subsidy
• If assessed a penalty employers can
appeal
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18. Automatic enrollment
• Employers with 200 or more FTEs must
automatically enroll all new full-time
employees in one of their employersponsored plans
• Employees not wanting insurance must
opt out
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19. Information return
In 2014 employers must file reports with the
Secretary of the Treasury detailing:
•
•
•
•
Whether or not they offer insurance
Details of the plans if they do
Costs of the plans
# of employees with full identification
Additionally a full report must be supplied
to each employee named in the report
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20. “Hidden” taxes
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21. Hidden taxes: PCORI
Patient-Centered Outcomes Research Institute
(PCORI)
• Established to assist patients, policymakers in
making informed health
• Fee determined by multiplying average number of
covered lives for the plan year times $1 in the year
2013 and $2 for second year, „14
• Fees after that will be readjusted as needed. Fees
are due each July 31st
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22. Hidden taxes: TRP
Transitional Reinsurance Program (TRP)
• Fee to fund Exchanges in transition period of
3 years
• Includes lives covered like employees,
spouses, dependents
• Also domestic partners who are covered
• Fee of $63 per covered life
• Begins 2014 & paid by Dec 31, 2014, „15 &
„16
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23. Individual mandate
Employers must educate employees not
covered or do not provide:
• Each person must maintain minimum
essential coverage for themselves and
dependents.
• If they don‟t they are assessed a tax
2014
$95 / year
1% of income
2015
$325/ year
2% of income
2016
$695/ year
2.5% of income
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24. Special mandate provisions
If the an individual is under 18 years old the
cost is 50% of the tax. The amount of the tax
is capped at 3 times the annual amount.
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25. How to calculate individual tax
Family of Three
Father Makes $60,000 & Mother makes $40,000
Child 12 years old
In 2016 $695 for father
$695 for mother
$347.50 for child
Total tax $1,737.50
Or 2.5% of Income
In this example $100,000 X 2.5%= $2500
Their tax would be $2500 annually paid on monthly
basis.
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26. Tax incentives for small
employers
• 2010-2013 Maximum Tax Incentives
• 35% for small business employer
• 25% for small tax-exempt employers &
charities
• 2014 Tax Incentives
• 50% for small business employer
• 35% for small tax exempt employers &
charities
Visit IRS.gov for more information
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27. Tax incentive eligibility
• Cover at least 50% of the cost of
single (not family) health care
coverage for each of your
employees.
• Have fewer than 25 FTEs
• Employees must have average
wages of less than $50,000 a
year
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28. Key points
• Employers are NOT required to pay 100%
of the cost of coverage
• Employees can be required to contribute
to the cost of coverage in increasing
amounts based on increased income
• Employees can be required to pay the
full cost of dependent coverage
• Large employers are only required to
OFFER coverage and there is no penalty
if the employee declines.
#hrsolutions

29. Questions?
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30. Get HRCI Recert Credits
• Visit http://b4j.com/hrciwebinars
& register to get PHR, SPHR & GPHR cert
credits free.
#hrsolutions

31. Learn more about . . .
• Mike Haberman www.b4j.co/OmegaHR
• Randy Peck www.b4j.co/randy-peck
• Jessica Miller-Merrell www.b4j.co/JMMbio-12
Other resources: IRS.gov, www.b4j.co/ACA-timeline, www.b4j.co/aca-w2,
www.b4j.co/PPACA-timeline
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