HR3590 Health Care Bill & Government Health Insurance

Businesses, be it small or large, will undoubtedly be included in the healthcare reform program. Some decisions regarding health care coverage for employees should now be based on the provisions provided by the new law.

If you’re in a small business with less than 50 employees, you may be exempted from coverage provisions. It’s another story for employers with 50 or more employees. Although these firms will not be forced to offer insurance to their employees, they will have to make it up by paying large fees to the government if ever they opt to let go of the opportunity.

Basically, if a company with more than 50 employees will not offer insurance benefits to its employees, and a regular employee will receive subsidy from the government by purchasing his or her own insurance on his own, the employer will be facing a charge of $2,000 from the federal government for every full-time employee. Another scenario would be to offer insurance to your employees and assist those in the low or middle class category to purchase their own insurance.

How does this work? If for instance you have an employee making less than 400% of the federal poverty level, and he finds the insurance offered by the firm to be too expensive, and his share of health premiums is greater than 8% of the family income, they can get their own insurance through an outside marketplace or what they call as an “exchange.” Being an employer, you will be helping them by way of a “free choice voucher” which is equivalent to the company’s share if that specific employee opted to take the company’s insurance offer.

On January 1, 2014, all these will be in effect. Companies will have to comply or face strict sanctions from the government.