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Rules for employers

Beginning this month, employers of 100 or more workers must provide affordable health insurance to all workers who put in 30 or more hours a week. Beginning in January 2016, the mandate will apply to employers of 50 or more workers.

Rules governing employers subject to the health law’s mandate include the following:

To determine a firm’s employee total, part-time and seasonal employees have to be counted. To arrive at a total, add every hour worked by part-time and seasonal employees, divide that number by 120 and add that result to the number of full-time employees. That number is the firm’s full-time equivalent.

Owners of separately incorporated businesses could have to count all those firms’ workers under a single umbrella. If one company owns 80 percent or more of another or if the same five or fewer people own 80 percent of several companies, the firms can be treated as one employer.  
 
The Affordable Care Act defines an affordable health plan as one whose premium is less than 9.5 percent of the employee’s W2 wages in the previous year. Plans also have to offer a specified menu of benefits.
 
Companies that misclassify workers as independent contractors could be forced to comply with the ACA mandate. If, for example, a firm has 95 regularly paid workers and five employees wrongly classified as independent contractors, it could be declared a 100-employee firm.
 
Employers must offer ACA-compliant coverage to at least 70 percent of their FTE employees. Any that do not do so and have one or more FTE employees who get a premium tax credit on an exchange plan would be subject to a penalty of $2,000 per uninsured worker.  
 
If an employer offers coverage in a plan that does not fall within the ACA’s definition of affordable or fails to provide benefits prescribed by the health care law, the fine increases to $3,000 per worker.

1/2/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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