The Employer's Legal Resource: A Few Reminders About What Employers Must Know About the Patient Protection And Affordable Care Act 0f 2010
The Supreme Court has spoken and now we know that the Patient Protection and Affordable Care Act of 2010 is, for the most part, constitutional. What does this mean for employers? Although some of the provisions of the Act went into effect in 2010 or 2011, others will be kicking in this year or next. Here are some highlights.
Beginning in 2010, employers who have fewer than 25 employees and provide health insurance may have qualified for a tax credit of up to 35% to offset the cost of the insurance. Non-profits may be eligible for a credit of up to 25%. In 2014, the credit will increase to 50%, or 35% for non-profits. The purpose of these credits is to make the cost of providing insurance lower for the employer.
Beginning this year, some employers must report the cost of healthcare coverage, including both employer and employee premium payments, on Form W-2, Wage and Tax Statement. Although this information must be included on the form, the cost of premiums is not taxable as income. The purpose of providing this information is to make employees aware of the cost of their healthcare coverage. This requirement applies to employers who file 250 or more W-2 Forms in the preceding calendar year.
Beginning in 2014, employers with 50 or more full-time equivalent employees must provide "minimum essential coverage" to all full-time employees and their dependents. Full-time employees are those working 30 or more hours per week. The employer must pay for at least 60% of the cost for employees only, and the total employee cost should not exceed 9.5% of any employee's household income. If any employee's cost of coverage exceeds 9.5% of household income and at least one employee purchases coverage through an insurance exchange, the employer must pay an assessment equal to the lesser of $3,000 per employee who buys coverage through an exchange, or $2,000 per full-time employee. The Act does not define "minimum essential coverage."
Of course, there will be many developments as time progresses. We will do our best to keep you informed as to how this law impacts Oklahoma employers.
Rebecca M. Fowler, email@example.com
David Hyman, firstname.lastname@example.org