The Affordable Care Act (“ACA”) is a complex and controversial law that will substantially impact both large and small employers as well as all individuals. Fortunately the attorneys at Kozloff Stoudt are ready and willing to help individuals and businesses successfully navigate the upcoming dramatic changes to the ways in which health insurance is provided by employers or obtained by individuals.
As many people know, the ACA contains an “Individual Mandate” requirement that takes effect on January 1, 2014. Under that individual mandate all U.S. citizens will be required to have health insurance which provides benefits for all services and procedures determined to be “essential” in nature by the federal government; or non-compliant citizenry will pay an income tax penalty to the federal government. Health insurance plans providing benefits for the required services and procedures will provide the required “Minimum Essential Coverage” under the ACA.
Concurrent with the ACA’s implementation of the Individual Mandate is the implementation of a requirement for “large” employers to offer a health insurance plan which provides, at a minimum the “Minimum Essential Coverage” to its full-time employees. If a “large” employer fails to offer health insurance providing benefits for at least the “Minimum Essential Coverage” to all of its full-time employees, the employer may be subject to a tax penalty collected by the Internal Revenue Service. The ACA defines a “large” employer under this statute as employer having 50 or more employees.
The ACA does not require a “large” employer to offer health insurance to its part-time employees, no matter how many part time employees it may have. The question for a “large” employer will then become whether or not a specific individual is a “full-time” employee under the ACA. Generally speaking, the IRS will consider any employee who averages 30 hours of work per week to be a fulltime employee for the purposes of the ACA. The IRS will look at individual situations to decide if an individual is, in reality, a fulltime employee under the ACA, if an employee averages less than 30 hours per week. However, as a general rule, an employer with more than 50 employees probably will not be required to offer health insurance coverage to an employee who does not average at least 30 hours of work per week.
If you have any questions regarding how the Affordable Care Act’s requirements may impact you or your business, please contact Kozloff Stoudt to set up an appointment to discuss your questions or concerns.