310.844.7614

License #1050831
DWJ Printing
  • Solutions
  • Custom Promotional Products
  • About Us
  • Blog
  • Contact

Impact on small businesses of the Affordable Care Act (ACA)

6/1/2016

0 Comments

 
Picture
The Affordable Care Act, also referred to as Obamacare, is the Obama administration’s tool to address problems within the existing healthcare sector, making affordable healthcare accessible to more Americans through reducing the cost of insurance. But what is the impact of the Affordable Care Act on small businesses? Consideration must be given to lawful requirements and the penalties for not adhering to them, as well as being aware of help available.

Defining a small business

A small business is defined as one that has 50 or less Full Time Equivalent employees. The ACA states that a FTE Employee works 30 hours a week. As this is not a standard for full time hours, businesses need to have a formula in place to calculate their full time employees taking into consideration that part time workers need to be included in the total. Adding one employee could tip the scales resulting in a small business changing status. Businesses could then face penalties if healthcare is not provided to employees. 

Documentation requirements

The requirements of the Affordable Care Act affect all businesses whether small or large in terms of how health benefits are viewed, provided to employees and reported. Understanding the requirements of the ACA on your business is the most important step towards compliance. Without a clear understanding, you may miss your responsibilities incurring unnecessary fines. Accurate and consistent record keeping, and monitoring of hours worked to ensure employees are classified correctly is essential. Organisations must keep documentation of employee eligibility for healthcare, as well as employee’s awareness of their eligibility. This can be done either through electronic signature receipt or manual distribution of documentation with a signed receipt.

Healthcare Plan Options

As a small business there are options available to offer employees healthcare. The Small Business Health Options Program allows small businesses access to more affordable health plans. Also, businesses with less than 25 FTE employees can apply for tax credits to assist with the cost of providing healthcare for employees. Remember a large business must provide, as a minimum, a Minimum Essential Coverage Plan (MEC) and maximum employee contributions vary in some states.

Benefits of providing healthcare

While small businesses are not liable to fines for not providing healthcare, it is important to consider the benefits of doing so. Providing healthcare can lead to greater employee job satisfaction, increasing staff loyalty, and giving the business a competitive edge for hiring skilled and effective employees.  
 
Who can help?
​
Businesses can employ a qualified consultant to ensure preparations are made. Advice is also available from the National Federation of Independent Business, Small Business Majority and the IRS. 
0 Comments



Leave a Reply.

    Categories

    All
    Business Management
    Marketing
    Signage
    Software

    Archives

    April 2020
    March 2020
    December 2016
    October 2016
    September 2016
    July 2016
    June 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013

    RSS Feed

Powered by Create your own unique website with customizable templates.