Business rules for the Affordable Care Act, part I

Business rules for the Affordable Care Act, part I

To say that the 2010 Affordable Care Act (ACA)— aka “Obamacare”— is far reaching is quite the understatement. If not significantly changed, the ACA will touch everyone in the USA. Already, we’ve seen come and go the first open enrollment period for private healthcare insurance, implementation of the individual mandate for insurance coverage, and a probing question about healthcare coverage on federal tax forms.

For businesses, here are two key things to keep in mind about the further rollout of Obamacare:

• The Employer Shared Responsibility Mandate (“Play or Pay”)— Under original ACA rules, all employers with 50 or more full-time (or full time equivalent, a.k.a. FTEs) employees could be subject to a penalty, starting in 2015, if they don’t offer health coverage or if the coverage is ruled to be unaffordable or not providing minimum value.  However, those rules have been modified. Employers with 50 to 99 FTEs now have until 2016 to comply, while employers with 100 or more FTEs still must comply starting Jan. 1, 2015. To avoid a penalty for not offering insurance coverage, employers with 100 or more FTEs must offer coverage to 70 percent of their FTEs in 2015 and 95 percent in 2016 and each year thereafter.

• Employer Information Reporting Mandate— Under modified rules, employers with 50 or more full-time employees (including FTEs) must report to the Internal Revenue Service on the health insurance coverage they do or don’t offer to employees. This mandate will be effective in 2015, with the first reports due in 2016. Work on IRS forms 1094-C and 1095-C, which will be used to report coverage information, is ongoing.

I’ll have more to write about the ACA in the next few columns. In the meantime, www.sba.gov/healthcare is a good business resource about Obamacare.

CREDITS

column by BAXTER TROUTMAN

BIO: Baxter Troutman is founder and chief executive officer of Labor Solutions, a staffing company with offices in Bartow, Winter Haven, Lake Wales, and Arcadia. A citrus grower who served in the Florida House of Representatives, Troutman understands the challenges and concerns of today’s farmer.