Health Care Act: Navigating Obamacare
Jim Kyger, vice president of human resources and labor policy for PIA.
Jim Cunningham, president of Printing Industries of Ohio and Northern Kentucky.
Paul Miller, vice president with insurance broker M.F. Irvine Corporate Solutions in Conshohocken, PA.
Death. Taxes. Obviously-scripted reality television shows. Well, we can add the Patient Protection and Affordable Care Act (PPACA) of 2010—commonly (and sometimes derisively) referred to as Obamacare—to the list of unpleasant certainties. And while we’ve known about mandatory health insurance for all Americans for several years now, some of the biggest provisions to come from the 5,000-plus-page law, namely the individual and employer mandates, are scheduled to kick in Jan. 1, 2014.
And New Year’s Day is closer than you think. So, are you ready?
Most of the buzz involving PPACA is the “pay or play” stipulation. Employers with more than 50 full-time workers must decide if they will offer health insurance or pay the penalty and have their employees use the state insurance exchanges. For example, a firm with 70 rated full-time employees that chooses to pay the penalty would be hit with an $80,000 penalty (the first 30 employees are not counted, thus 40 multiplied by $2,000 per person).
A second way printing companies can pay the penalty is if their coverage is not affordable to 95 percent of their full-time employees (defined as costing the employees up to 9.5 percent of their W-2 wage for single coverage), or the plan does not meet the minimum value requirement (the plans pay for at least 60 percent of covered health care expenses). The penalty equals the number of full-time employees receiving premium tax credit or cost-sharing reduction—making less than 400 percent of the federal poverty level—multiplied by 1/12th of $3,000 (lesser of amount calculated or the amount that would be owed if the employer did not offer coverage).
Most printers are in good shape. Less than 5 percent of firms do not currently offer health insurance benefits, according to a study by the Printing Industries of America (PIA). Further, 75 percent to 80 percent of the printing industry consists of firms with fewer than 50 employees. Thus, only a fraction of benefits-less companies find themselves needing to make the “pay or play” decision.