Health care reform will impact every aspect of your company
So health care reform has passed. What does it mean for you? Much will become clear only with time. But here are a few things we know so far:
- Starting now, children can stay on their parents’ policies until 26.
- Subject to regulations, employers with 200+ employees must automatically enroll them in health plans unless employees have other coverage.
- From 2013 on, employer-sponsored plans with aggregate coverage values of $8,500+ for individuals and $23,000+ for families must pay excise tax equal to 40% of the excess benefit.
- Starting in 2014, a $750 per-full-time-employee fee will be imposed on employers with 50+ employees that don’t offer coverage and have at least one employee receiving a tax credit to help pay premiums.
- Also in 2014, employers that require a wait before plan enrollment will owe a $400 penalty for any full-timer in a 30-60 day waiting period and $600 for those in a 60-90 day wait.
A subsequent change in the health care reform law modifies the penalty imposed on so-called “Cadillac plans” — those that offer benefits above a certain threshold. (Third bullet point above.) Now, those thresholds are $10,200 for individual coverage and $27,500 for family coverage, indexed to inflation. And the penalties won’t take effect until 2018.
Also, the fee imposed on employers that fail to offer minimum essential coverage is now $2,000, as of 2014. (Fourth bullet point above.)
Just as important, it’s now clear that three additional requirements will apply starting this year:
- Employers and insurance companies may no longer retroactively cancel coverage except in limited circumstances.
- Employers may no longer set lifetime limits on essential benefits. (Only “reasonable” annual limits on essential benefits are permitted until 2014. Starting then, annual limits on essential benefits are prohibited, too.)
- Employers may not exclude coverage for dependents under age 19 on account of preexisting conditions. (Starting in 2014, nobody can be excluded from coverage because of preexisting conditions.)
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