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Employer Mandate Delayed … again

By now, you’ve probably heard that the Employer Mandate to provide health insurance for employees has been delayed until 2016 for mid-sized companies. In addition, large employers need only offer health coverage to 70% of its employees in 2015.

But what exactly do these changes mean for large, mid-sized and small employers?

Mid-Sized Employers

The biggest change affects companies with 50-99 full-time equivalent (FTE) employees. Under the new regulations, these employers will not be facing penalties if they do not provide affordable, minimum value, health coverage to their employees until 2016. This regulation simply delays the requirements and associated penalties one additional year.

Large Employers

Employers with 100 or more FTE employees are still required to provide health care coverage to their full time employees or pay the penalties beginning in 2015. However, large employers are getting a break as well. In the original law, large employers had to offer health coverage to 95% of their full-time eligible employees. Clarification on how employers could choose which 95% to include was not given. Many employers assumed that the 95% number was created as a buffer to help protect employers who made eligibility calculation errors and other mistakes. New regulations change this number to 70% for 2015. Since it seems obvious that this is not meant to be a buffer to cover errors, it is now even more unclear how an employer can decide which 70% to choose.

This leads to more questions than answers. It is doubtful that guidance from the government on these matters will come quickly, if at all. Employers will need to be careful that they don’t make these decisions on a discriminatory basis. SERPEO will keep you updated as information becomes available.

Small Employers

Employers with less than 50 FTE employees are not affected by these revisions in the Employer Mandate because they do not have to offer coverage. All current requirements remain in effect.

Overwhelmed by the rapid pace of change in the human resource field? SERPEO can help! We stay abreast of the latest in benefit and human resource matters to help ensure our clients are compliant.

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