Multiple deadlines are looming for Colorado and other states as the Affordable Care Act is fully implemented. Although it was signed into law more than three years ago, many of the healthcare law’s provisions are just beginning to take effect.
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"The biggest looming deadline is January 1, 2014," says Boulder County Business Report publisher Chris Wood. "That’s when employers with 50 or more employees must either offer health insurance or face possible tax penalties. But that’s just the most basic of deadlines facing businesses right now – a lot of provisions are kicking in as well."
For small businesses scrambling to comply, Wood says there are resources to help, including the state’s healthcare website.
It’s not only businesses facing that January 1 deadline. Individual consumers will be required to maintain health insurance after that, with a few exceptions. In Colorado, they’ll have the option of doing that through a new health insurance exchange.
Other key provisions kicking in?
"The Affordable Care Act totals 3,000 pages — even the condensed version is 900 pages. And there are at least 20,000 pages of regulations implementing the law.
But some of the other highlights include a requirement to report employer-sponsored health contributions on W-2 forms beginning with the 2012 tax year; fees for self-insured plans, with the first payment due July 31; and reductions in the annual limit for flexible spending accounts, from $5,000 to $2,500."
Most likely outcome for businesses and consumers?
"I think the answer is, 'it depends.' The wealthy will pay more in taxes to support the Act. One provision puts a new 40 percent excise tax on what are called 'Cadillac' health plans, including plans that cost more than $10,200 for individuals and $27,500 for families. But that provision is not indexed to inflation, so less generous plans eventually could be taxed as well.
If you have a business with 50 or more employees and don’t offer insurance, you could face a fine of $2,000 per full-time worker, excluding the first 30. For businesses with fewer than 25 full-time employees, you could actually receive a tax credit to help provide health insurance to your workers."
What decisions must smaller Colorado companies make?
"We spoke with a health-benefits attorney who summed it up this way in terms of what those businesses should consider:
- Should I offer no insurance and let my employees buy their own insurance?
- Should I contribute to coverage that an employee might buy in an exchange?
- Should I offer the same coverage I do now, but tweak it to comply with the law?
- Should I buy a group health plan through the exchange?
Business owners can consult with a reputable insurance brokerage. [They] have become very well-versed in the law and what business owners need to do to comply."
Read more about what Colorado businesses need to know [.pdf].