Health Reform Update: Reminder to Employers with 51-100 FTEs
About the Employer Mandate
Health Care Reform’s Employer Mandate currently requires employers with 51 or more full-time equivalent employees to pay a penalty if they don’t provide minimum value, affordable health insurance to their full-time employees and dependent children. Employers with 51-99 FTEs received transitional relief from this mandate until 2016. Upon renewal starting January 1, 2016, however, employers with 51 or more employees will be required to comply with the Employer Mandate.
Under the Employer Mandate, “full time” is defined as an employee who works on average 30 hours or more per week. Those employers who do not offer coverage must pay a penalty of $2,000 per full-time employee (not including the first 30 employees). If the employer has never offered health insurance to their employees in the past, they will be required to offer insurance or pay the penalty.
Expansion of Community Rated Pool
The Affordable Care Act also changes groups covered by the current community rating model from employer groups with 1-50 full-time eligible employees to employer groups with 1-100 total employees (note: groups of 1 cannot be sole proprietors or primary family coverage only). We’ve begun identifying groups that may be impacted by the proposed community rating change for renewals on or after January 1, 2016.
We are working with our legal team and the Department of Financial Services (DFS) to obtain clarification on how employees should be counted and other guidance. Rest assured that we are committed to gathering feedback from our broker partners as we go through the planning process. We will also be sending regular communications starting this summer.
Thank you for your continued patience as we work to fully understand the impact of this coming change.