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Pay or Play?
 

Pay or Play?

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"Should I provide health insurance for my employees?" The process for determining the cost of providing health care benefits and the impact of health benefits an retaining and attracting ...

"Should I provide health insurance for my employees?" The process for determining the cost of providing health care benefits and the impact of health benefits an retaining and attracting best-in-class employees.

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    Pay or Play? Pay or Play? Presentation Transcript

    • E D U C A T I O N S E R I E S
      Pay or Play?
      Date: August 10, 2010
      Presented by:
      Dominic Franchini
      Vice President Market Development, HORAN
      William Freedman
      Attorney, Dinsmore & Shohl
      Marty Howard, CPA
      Cassedy Schiller
    • Agenda - Pay or Play
      Define the regulation, employers affected and timeline
      Review the moving parts
      Model options and costs
      Identify tax consequences
      Discuss employer notification requirements
      Share other key points to consider
    • Regulation Highlights
      Beginning in 2014, individuals must maintain “minimum essential coverage” or pay a penalty
      Applicable large employers with 50 FTE’s may owe penalties
      Failure to offer “minimum essential” health coverage
      Offering “minimum essential” health coverage that is not affordable
      Full time employee = 30 hours or more per week
      Full time employees may be eligible to purchase coverage through exchange
      Full time employee may qualify for premium credit
    • Who is affected
      Businesses with 49 employees or less
      Exempt from pay or play mandates
      Businesses with 25 employees or less
      Exempt from pay or play mandates
      Eligible for tax incentives IF currently offering group health benefits
      Businesses with 50 or more employees
      Required to comply with pay or play mandates
    • Timelines
      Insurance as “usual” until 2014
      New discrimination rules
      New underwriting requirements
      W-2 reporting of 2011 benefits
      Small business tax credit 2010 - 2013
      Exchanges established by January 1, 2014
      Pay or Play begins January 1, 2014
    • Things to Consider
      How much does insurance cost my company today?
      How much would I pay in penalties?
      Is my benefit plan design compliant? Cost to change benefit design?
      Do I have employees a 100% to 400% federal poverty guideline?
      Is my contribution affordable for those employees?
      How much would penalty be for employees receiving assistance?
      How would employees purchase insurance outside employer? Cost?
    • For Example
    • 8
      Employer Notification
      Required notifications to employees (Not later than March 1, 2013)
      Existence of an Exchange, description of services, how to get assistance
      Employer plan’s share of total allowed cost is less than 60%, eligibility for premium tax credit
      Purchase of health plan through exchange, outside free choice voucher, may forfeit employer contribution and tax deduction
      Required notifications to Secretary of Treasury
      Name / Address / TIN # / months enrolled for all FTE
      Waiting period
      Months during year coverage is available
      Monthly premium for lowest cost option
      Employer’s share of total allowed cost
    • Common Considerations
      Divisions / Common ownership
      Cafeteria plan
      1099 employees
      Contributions defined as % income