De Pere Area Chamber, Lori Compas, Wisconsin Business Alliance, ACA 9-11-13
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Presentation on the Affordable Care Act given by Lori Compas, Executive Director of the Wisconsin Business Alliance and its sister foundation to De Pere Area Chamber of Commerce on 9/11/13.
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De Pere Area Chamber, Lori Compas, Wisconsin Business Alliance, ACA 9-11-13
- 2. How the Affordable Care Act affects your small business
- 3. Presentation Overview • Current health care system • ACA changes already in effect • Changes coming with the new exchanges • Making your choice • Employee notification deadline: Oct 1
- 4. Current health care system • High cost: Premiums have doubled over the past nine years • Small businesses pay 18% more than big businesses • Insurance costs more for women and older workers • Pre-existing conditions = denied coverage or very expensive coverage • Difficult to compare insurance plans
- 5. ACA changes already in effect • No penalties for women and older workers • Children with pre-existing conditions cannot be denied coverage • Plan costs and benefits are standardized and easy to compare • Young adults can stay on their parents’ plans until they’re 26
- 6. The new health care exchanges • You don’t have to offer coverage. No penalty if you have fewer than 50 employees. • Health care exchanges are an option, not a requirement • If you want to offer coverage, you can choose to buy coverage on the SHOP marketplace.
- 7. SHOP Marketplace • Standard coverage at various levels: Platinum – Gold – Silver – Bronze • Allow you to “compare apples to apples” • ALL SHOP plans fully cover… – Preventive care – Immunizations – Well child check-ups – and more
- 8. SHOP Eligibility • Open to employers with 50 or fewer FTEs (full-time-equivalent employees) • If you're self-employed with no employees, you can get coverage through the individual Health Insurance Marketplace, but not through SHOP.
- 9. SHOP Features • Compare health plans online • You control the coverage you offer • You decide how much to pay toward employee premiums • All plans offer preventive care, immunizations, well-child check-ups, etc. • You may qualify for a tax credit worth up to 50% of your premium costs
- 10. Tax credits • For-profit businesses • < 25 FTEs (and only for employees) • Pay at least 50% of employees’ premiums • Employees’ annual salaries can average no more than $50,000 • Beginning 2014, tax credit is available only for plans purchased through SHOP.
- 11. Calculating & claiming your tax credit • Use IRS Form 8941, Credit for Small Employer Health Insurance Premiums • Include the amount as part of the general business credit on your income tax return • Calculator (try different scenarios) WisconsinBusinessAlliance.com /ACA
- 12. Deductions Since the amount of the health insurance premium payments is more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit. That’s both a credit and a deduction for employee premium payments.
- 13. Enrollment You can enroll either… • Through a broker, or • Directly through the SHOP exchange
- 14. Payments You can choose to… • Collect employee share of premiums through payroll deduction • Make premium contributions to SHOP with pre-tax dollars • Get one monthly bill, make one monthly payment to SHOP
- 15. Making your choice • You determine your employees’ deductible, co-pays, and out-of-pocket • In general… Lower premiums Higher out-of-pocket Higher premiums Lower out-of-pocket • Platinum plans generally have the highest monthly premiums and lowest out-of-pocket costs. • The plan with the lowest premium may not provide you or your employees with the best overall value.
- 16. Employee notification You must notify employees of the new exchanges by October 1, 2013 How to notify? Model forms available from the U.S. Dept. of Labor or WisconsinBusinessAlliance.com/ACA
- 17. Questions? Have questions about the SHOP Marketplace for businesses with 50 or fewer employees? Call 1-800-706-7893 Monday through Friday, 8-4 central time Or visit healthcare.gov/small-business
Editor's Notes
- Source: SBA
- Metal levels have nothing to do with QUALITY.The Affordable Care Act ensures health plans offered in the individual and small group markets, both inside and outside of the Health Insurance Marketplace, offer a comprehensive package of items and services, known as essential health benefits. Essential health benefits must include items and services within at least the following 10 categories: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care.Insurance policies must cover these benefits in order to be certified and offered in the Health Insurance Marketplace, and all Medicaid state plans must cover these services by 2014.
- You are probably wondering: what IS an FTE? Basically, two half-time workers count as one FTE. That means 20 half-time employees are equivalent to 10 FTEs, which makes the number of FTEs 10, not 20.(Changing to 100 FTEs in 2016)
- Employers can receive a tax credit for up to 35% of what they spend on coverage for employees (25% for nonprofits). On Jan. 1, 2014, this tax credit increases to 50% (35% for nonprofits).Business owners and their families are not eligible for the tax credit.Average annual wages. Say you pay total wages of $200,000 and have 10 FTEs. To figure average annual wages you divide $200,000 by 10 — the number of FTEs — and the result is your average annual wage. The average annual wage would be $20,000.The maximum tax credit is available to employers with 10 or fewer full-time equivalent employees and average annual wages of less than $25,000
- Employers can receive a tax credit for up to 35% of what they spend on coverage for employees (25% for nonprofits). On Jan. 1, 2014, this tax credit increases to 50% (35% for nonprofits).Business owners and their families are not eligible for the tax credit.
- Employees’ deductible payments and copays – and the total amount they spend out-of-pocket for the year if they need a lot of care – depends on which plan category you choose.As with all health plans, you and your employees will pay a monthly premium. You can decide up front how much you can afford to contribute toward your employees’ premium costs, so you have more control over your company's health coverage spending.For example, with a Bronze plan, the premiums will be lower than a Gold plan. But your employees will probably pay more when they go to the doctor.