Last month, the Supreme Court upheld, for the most part, the Affordable Care Act, popularly known as “Obamacare”. Barring the Republicans’ successfully carrying out their pledge to repeal the Act if they win control of the government after the November elections, there are provisions of the act that eligible small employers must begin taking steps to comply with over the coming months. These steps include:
– finalizing the Summary of Benefits and Coverage by the first day of open enrollment this fall
– complying with the $2,500 annual limit that applies to health flexible spending accounts that take effect in 2013, including distributing materials to employees prior to 2013 that accurately describe the limits
– contacting insurers to ensure that research fees that will be imposed by the Act on certain insurers and plan sponsors of self-insured health plans ending on or after October 1, 2012 are paid in 2013
– implementing procedures to track and record health coverage costs for the new W-2 reporting requirements for certain employers
There are also several other provisions of the Act that will begin to take effect over the next several years that employers should begin to plan for:
– ensuring that preventative care requirements for women are in certain plans that begin on or after August 1, 2012.
– deciding what to do with distribution of applicable medical loss ratio rebate requirements (certain insurers that fail to spend a specified percentage of premiums on covered claims and quality improvement expenses must provide rebates to applicable health plans beginning August 2012; employers myst decide how to handle such rebates)
– plan for 2013 increases in Medicare payroll and FICA taxes for highly compensated individuals
– providing notices to employees about the health insurance exchanges that will begin in 2014
– ensuring compliance with the employer mandate requirement that will apply to employers of 50 or more full-time equivalent employees by providing at least minimum coverage or paying the financial penalty
– ensuring compliance with “grandfathered” health plans, including expanded dependent coverage, preexisting condition exclusion requirements, restrictions on eligibility waiting periods longer than 90 days, elimination of annual dollar limits, incentive/penalty requirements for wellness incentives, new minimum essential coverage requirements and clinical trial coverage requirements and provisions regarding guaranteed availability and renewability of insurance and automatic enrollment requirements, changes to Medicare Part D, and a new plan excise tax beginning in 2018 if the value of health coverage exceeds a specified amount.
Small businesses with only a few employees are exempt from many of the new provisions under the Affordable Care Act. However, if you feel you may have to comply with some of the new provisions, it is best to speak to your attorney to determine your business’s eligibility both now and also when these provisions come into effect — you may not have enough employees now to trigger a provision taking effect in 2014, but your business plan may have you hiring enough employees by 2014 to trigger that provision, so it is better to begin planning now to bring your company into compliance.