Health Care Reform for Businesses
The Patient Protection and Affordable Care Act (the Affordable Care Act) had some key provisions that apply to businesses. Perhaps the item of most interest to employers is that beginning in 2015, many businesses that do not offer affordable health insurance coverage that provides a certain minimum value to at least 95% of their full-time employees (and their dependents) may be subject to an excise tax (i.e., penalty).
Businesses that already offer health insurance coverage for employees must carefully evaluate the coverage their health plan provides. Many provisions of the law do not apply to plans that were in existence on March 23, 2010 (i.e., grandfathered plans), as long as the plan maintains its grandfathered status. However, some provisions apply to these grandfathered plans.
Additional reporting requirements relating to employees are also required. However, along with these additional requirements are some incentives, including tax credits for certain small businesses.
Many of the health care legislation's provisions that affect employers were effective in either 2010 or 2011. Others are not effective until later. Undoubtedly, additional legislation or guidance will affect provisions that have a delayed effective date. Businesses should be diligent about taking the proper steps to identify any changes in processes and procedures that are needed to comply with the law. This letter provides a brief overview of the key provisions affecting businesses.
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