Obamacare for Small Business

Employee Notification Requirement
Every employer subject to the Fair Labor Standards Act is required to provide a "Notice of Coverage Options In Exchange" to each current employee no later than October 1, 2013. Thereafter, each new employee must receive a Notice within fourteen (14) days of the employee's start date. A notice is available for download on the contact us page.

The Employer Mandate
As a business you are only mandated to provide health insurance to your employees if you have 50 or more full time equivalents (FTE). What is an FTE? The new law says 30 hours a week is full time, therefore, two employees each working 15 hours a week equals one FTE. If your total number of FTE's reaches 50 then your business is subject to the mandate. The FTE count is based on a look back period of the previous year and uses IRS common ownership rules when counting employees across multiple separate business entities.

What does it mean to be subject to the employer mandate? If you do not offer health insurance and any of your full time employees receive premium assistance when they purchase individual health insurance, then the business will owe a tax penalty of $2,000 per full time employee. The first 30 full time employees are excluded from the calculation. Similar penalties apply if the coverage offered is deemed inadequate. These penalties are not deductible expenses.

Group Insurance Changes
For group plans several changes will occur starting in 2014. 1) Age banding will stop; there will be a rate for children to age 20, each year from 21 to 64 and a 65+ rate.  2) All age related pricing changes will adjust at renewal rather than per employee during birth month. 3) There will no longer be a risk adjustment factor (RAF) for variation of price based on medical underwriting considerations.

Read more ...