Effect of Healthcare Legislation on Business Owners
I came across an article that I thought may be of interest to fellow business owners regarding the provision in the Health Care and Education Reconciliation Act of 2010 (Reconciliation Act, P.L. 111-152). This act requires that employers offer and contribute to their employees’ health insurance or they will be forced to pay a penalty. After Dec. 31, 2013, legislation will require “large employers” (those who employed an average of at least 50 full-time employees during the preceding calendar year) who do not offer sufficient health insurance coverage to all of their full-time employees to pay a penalty, if any full-time employee is certified as having purchased health insurance through a state program for which a tax credit or cost-sharing reduction is paid to that employee.
The penalties that will be assessed depend on the infraction which occurs. While the penalties themselves are monetary in nature, the amount will be based upon how many full-time employees are not being provided adequate coverage and whether or not any of these full-time employees are receiving premium tax credits.
Are you a “large employer”? What effect will these provisions have on large business owners? While these provisions do not go into effect until 2014, we could begin to see immediate changes in the next year. Unfortunately, we may see employers reducing their workforce to avoid being subjected to fines and penalties. Hopefully, the “health insurance” tail will not start “wagging the dog” and harm the economy by adding more people to the unemployment line.