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Understanding PPACA and Employee Health Coverage

Dive into the complexities of the PPACA law on employee health coverage: penalties, costs, and employer responsibilities. Explore examples, consequences, and strategies for compliance.

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Understanding PPACA and Employee Health Coverage

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  1. PPACA Pay or Play? Brett S. Morris, Fox Everett Inc.

  2. Pay or Play Buy insurance or play the penalty?

  3. Pay Tax vs. Provide Coverage? • Penalty applies to every full-time employee (after the first 30). If no coverage is offered • Penalty is avoided by offering affordable coverage with minimum value, even if employee declines. • Cost of coverage applies only to those who take it.

  4. Example Assumptions Percentage of EE's Covered 75% EE Share of EE Only Cost 25% EE Share of Dependent Cost 60%

  5. Example – Cost of Health Plan Assumptions Percentage of EE's Covered 75% EE Share of EE Only Cost 25% EE Share of Dependent Cost 60%

  6. Example – Cost of Health Plan Assumptions Percentage of EE's Covered 75% EE Share of EE Only Cost 25% EE Share of Dependent Cost 60%

  7. Example – Cost of Health Plan Assumptions Percentage of EE's Covered 75% EE Share of EE Only Cost 25% EE Share of Dependent Cost 60%

  8. Example 1 – Cost of Health Plan

  9. Example 1 – Cost of Health Plan

  10. Example 1 – Cost of Health Plan

  11. Example 1 – Cost of Health Plan

  12. Example 1 – Cost of No Plan

  13. Example 1 – Cost of No Plan

  14. Example 1 – Cost of No Plan

  15. Example 1 – Cost of No Plan

  16. Example 1 – Cost of No Plan

  17. Example 1 – Effect on High Income Employee

  18. Example 1 – Effect on High Income Employee

  19. Example 1 – Effect on High Income Employee

  20. Example 1 – Effect on High Income Employee

  21. Example 1 – Effect on High Income Employee

  22. Example 1 – Effect on High Income Employee

  23. Example 1 – Effect on High Income Employee

  24. Example 1 – Effect on High Income Employee

  25. Example 1 – Effect on High Income Employee

  26. Example 1 – Effect on High Income Employee

  27. Example 1 – Effect on High Income Employee

  28. Example 1 – Cost of No Plan

  29. Example 1 – Cost of No Plan

  30. Example 1 – Cost of No Plan

  31. Example 1 – Cost of No Plan

  32. Example 1 – Cost of No Plan

  33. Example 1 – Cost of No Plan

  34. Consequences of Gross-Up Pay • Additional employer payroll tax • Additional retirement plan costs • Profit sharing • 401(k) match • Pension accruals • Additional life insurance costs

  35. Example 2 – Non-Profit Employer

  36. Example 2 – Non-Profit Employer

  37. Example 2 – Non-Profit Employer

  38. Example 3 – 100 Employees

  39. Example 3 – 100 Employees

  40. Example 3 – 100 Employees

  41. Example 4 – 60 Employees

  42. Example 4 – 60 Employees

  43. Example 4 – 60 Employees

  44. Strategies

  45. Multiple Plan Options • Bronze Plan • Higher tiered option • Test the waters with a noncompliant plan • Tin Plan • Individuals may owe individual penalty • Affordability test

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