Small Employer 1-49 Employees

Small employers are not required to offer health benefits to their employees. There are many reasons for continuing to offer benefits including recruiting and retention of a talented workforce.

Will I pay a penalty if I don’t offer health benefits to my employees?
No. Under the Affordable Care Act, employers with fewer than 50 full-time employees and full-time equivalents are not required to offer employer-sponsored coverage. Unsure if you are a small or large employer? Use our FTE calculator to find out.

Will my employees pay a penalty if they don’t have health insurance?
Yes. The law requires Americans to carry health coverage or pay a penalty on their annual income tax filing. The penalty is the greater of 1% of household income or $95 per adult ($47.50 per child) in 2014. The fee increases to the greater of 2.5% or $695 per adult ($347.50 per child) in 2016. 

How will small employers buy coverage in 2014?
Employers can continue to use the same shopping methods they use today. For example, purchasing from a health benefits company with the help of an independent agent/broker. In addition, the federal government is introducing the Health Insurance Marketplace (formerly called the health insurance exchange). There will be both public and private exchanges.

What will coverage include?
Beginning in 2014, all non-grandfathered health insurance coverage in the small group markets will be required to coverage essential health benefits. These services include benefits that most small employer plans cover today such as emergency services, preventive care, hospitalization and lab services. Small groups must have an annual limitation on cost-sharing for essential health benefits and they cannot set deductibles above $2,000 for self-only and $4,000 for family coverage.

What will coverage cost?
Changes in rating rules and additional taxes and fees will have the most impact on the cost of health coverage in 2014. Under these changes, insurance carriers can set prices in the small group and individual markets based on three things: geographic factor, age and tobacco use. Plus, the ACA has added five taxes and fees to the purchase of most plans.

Will coverage have to change?
All health plans in the small group market must be assigned to a metal tier, which reflects the value of the benefits package. The metal tiers measure the value of the essential health benefits within each plan tier: platinum or 90%, gold or 80%, silver or 70% and bronze or 60%.

Are there tax benefits to companies that offer employee benefits?
Yes. Small businesses are eligible for tax credits. Use our small business tax credit calculator to determine if your company qualifies.

Questions

Click here to learn about the various resources available to our clients or contact us at 877-668-6660 for further information