group health plan

It’s Back Again!

Another update from the Jungle….

unnamed (11)Michelle owns a small business of 35 employees that is slowly expanding. She’s ignored the Affordable Care Act (ACA) ever since she realized that her company was too small to be subject to the employer penalty. Besides, she has other concerns, such as finding new markets for her company so that it can continue to grow.

However, her employees like having benefits, including health coverage. Last year, Michelle encouraged her employees to obtain individual health policies because she couldn’t afford a group health plan. Now the issue has arisen again as the annual open enrollment period for the Exchange approaches on November 1st.

Michelle would like to offer a group health plan because she thinks it would be a nice perk for employees. But she’s heard other small business owners complain about increased premium costs.
image038She’s afraid she can’t afford a group plan this year either.

She does a quick survey of her employees. She learns that 15 of them have coverage through their spouses. One employee is an early retiree covered under a former employer’s plan. Another employee is eligible for Medicare. Part-time workers wouldn’t be eligible for coverage in an employer’s group health plan under the ACA rules.

That leaves a grand total of 12 employees who are interested in a group health plan. Of the 12 employees, several could qualify for a subsidy from the Exchange based on their income and family size.

What should Michelle do next?

  1. She can ignore the issue completely since her company is not subject to the employer penalty.
  2. She can ask her insurance agent to give her information on a group health plan option for the 12 employees who are interested in coverage.
  3. She can arrange for an insurance agent to come to her work place to help employees choose individual health policies, through the Exchange or outside the Exchange.

There are no easy solutions for small employers regarding health coverage. Small employers may find that not offering a group health plan actually helps their lower income employees to qualify for a subsidy through the Exchange. On the other hand, any employer offering a group health plan may use a business tax deduction to offset part of the cost of the plan. An experienced insurance agent or producer can help small employers assess their options.

If your company is struggling with HR issues, Corporate Compliance Risk Advisor can help you create HR policies that are appropriate for your company’s size and then serve as a resource to your staff as the policies are implemented.

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Are you ready for 2015?

Another update from the HR jungle…


Sue is the human resources director for her company (because she’s the only HR department employee). She is frantically working her way through her year-end checklist so that she can take a two week, rum-infused holiday cruise in late December. Today she’s working on checklist items related to the group health plan.

First on her checklist is a note to update the on-line information about the company’s group health plan to show the new out-of-pocket limits for 2015. Her company has a high deductible health plan (HDHP) with a health savings account (HSA). In 2015, HSA contributions are limited to $3,350 for individuals and $6,650 for families. The maximum out-of-pocket limits are $6,450 for individuals and $12,900 for families. If she posts the information on-line, some employees may actually read it rather than calling her with their questions.

Second on her checklist is to confirm that the new ACA-compliant software is properly tracking the hours of employees. Sue was impressed by the software vendor’s ability to customize the software to track her company’s high turnover employees. Sue’s company is not subject to the employer penalty in 2015 because they met the transitional relief for employers with 50 – 99 employees. But Sue still worries about last minute glitches when new software programs are implemented.

Does your ACA-compliance checklist look like Sue’s? Can you think of any items on your checklist that Sue has forgotten?

Sue’s already dreaming about the rum and fruit drinks she’ll be enjoying on her cruise, but she’ll continue working on her checklist items in next week’s column.

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Pay Now or Pay Later.

Another update from the HR jungle….

9098832-a-set-of-tools-for-repairs-vector-illustrationBarb owns a small home repair business with six employees. She pays them wages higher than the industry average so that they won’t defect to larger competitors who can offer more benefits. She’d like to add a group health plan as another incentive to remain loyal to her company.

But, once again, the health insurance quotes Barb received gives her sticker shock. There’s no way she can pay the employer’s portion of the premium for a group health plan. She’s already paying a fortune for her worker compensation premiums.

She knows her employees can’t afford the employee’s portion of the premium on a group health plan. Don Juan Smith’s paycheck is subject to the maximum allowed payroll deductions due to the court-ordered child support he owes to two girlfriends. High Risk Randy’s wages are being garnished for old debts and he’s never paid voluntarily for any employee benefit.

What options are available to Barb?

  1. She can remind her employees that annual open enrollment for the Exchange (a/k/a Marketplace) began on November 15th. They can apply for individual health policies or apply for an individual exemption to the requirement of having health insurance.
  2. She can tell her employees to talk to a health insurance agent about coverage options for the employee or for the employee’s family.

Is your business struggling to understand the Affordable Care Act and how it affects your company and employees? Corporate Compliance Risk Advisor can provide an overview of how the ACA affects employers and employees and answer specific questions you may have.

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