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What Health Care Reform Means for Small Businesses


New legislation, stemming from the implementation of the Patient Protection and Affordable Care Act (PPACA) can be difficult to understand. The complexities surrounding health care reform provisions are driving employers of all sizes to search for understanding through resources and advisors they can trust.

So what is it that business owners, specifically small-business owners, must know when it comes to health care reform? First, let’s take a look at a selection of the provisions under health care reform and how they are affecting small employers:

Small Employer Tax Credits

Effective: Current small employer tax credit rates are effective through 2013; enhanced credit will be available on January 1, 2014.

If you employ fewer than 25 full-time equivalent employees with average annual wages of less than $50,000 and contribute to employees’ qualified health care coverage a uniform percentage not less than 50 percent of premium costs, you are eligible to take advantage of this requirement.

Small employers that satisfy the criteria have been eligible to receive tax credits since 2010. For tax years 2010 through 2013, the maximum credit is 35 percent for small business and 25 percent for small tax-exempt employers. An enhanced credit will be available January 1, 2014.

Establishing Affordable Insurance Exchanges

Effective: States must notify the Secretary of Health & Human Services by January 1, 2013; Exchanges must be operational by October 1, 2013, in time for January 1, 2014 open enrollment.

Employers with fewer than 101 full-time equivalent employees are eligible to purchase health insurance coverage through exchanges. In some states, this number may be as low as 50 employees.

The deadline for states to relay their intent to establish a state health insurance exchange was January 1, 2013, for a state-based exchange, and until February 15, 2013 to opt for a partnership exchange. These exchanges must be operational by October 1, 2013, in time for open enrollment for effective dates of January 1, 2014, and thereafter when the individual mandate becomes effective.

Exchange Notification Requirement

Effective: Delayed until late Summer or early Fall 2013.

If a small employer is subject to the Fair Labor Standards Act, the organization must comply with this requirement.

Employers must provide employees with written notices about new health insurance benefit exchanges on or after the effective date. This notice must be given to new hires and to those who are already employed. The Department of Labor has not yet issued the form notice, and the requirement was recently delayed for an indefinite period of time.

To learn about additional requirements for small employers under the Affordable Care Act, please request our PPACA Checklist

Other Resources
As 2014 draws near, the need for employers to have a full understanding of the implications surrounding PPACA provisions is imperative. Employers looking to reduce the uncertainty surrounding PPACA provisions can take advantage of a multitude of free resources including:

Health Care Compliance Webcast Series

BenefitMall recently launched a Health Care Compliance Webcast Series to provide the knowledge and insight that every business owner should know to remain compliant with PPACA. The webcast series launched in February 2013 and drew an audience of more than 1,200 attendees composed of employers, insurance Brokers and CPAs for education on the 2013 PPACA compliance regulations. The company will continue the series on a monthly basis throughout 2013.

HealthcareExchange.com

Healthcare Exchange® is an online community with more than 6,000 members. Here members learn from compliance experts and find useful information regarding health care reform.  Members can also view the archived version of the Health Care Compliance Webcast series and stay abreast of new developments around health care reform.

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