Your Business and the Affordable Care Act
The Affordable Care Act, otherwise referred to as “Obamacare,” was signed by the president in March of 2010, and will roll out into effect over the course of four years. Open enrollment for healthcare began in October of 2013, and in 2014 businesses of varying sizes will be affected in different ways. Here is a breakdown of how your business will be affected, according to the size of the business you are operating:
If you operate a sole proprietorship:
If you run a sole proprietorship, then you can seek coverage through individual health insurance marketplaces. You will have options to choose from on the healthcare.gov website, where you will create an account, fill out information about yourself and your family, pick the plan that best suits you through the individual Marketplace, and enroll. As a self-employed individual, you might be eligible for individual tax credits and subsidies based on your income, even if you hire out contracted work. You will find out if you qualify for lower costs once you file a Marketplace application. The Marketplace offers you various plans so that you can find one that fits your budget and needs.
If your business has fewer than 25 employees:
If this is your situation, you may be eligible for a small business Health Care Tax Credit. This will help you as an employer afford the cost of covering all of your employees with health insurance. The purpose of the credit is to not only encourage employers to offer health insurance for the first time, but also to help them maintain the coverage they may already offer. In 2014 the tax credit will be available only to those businesses who participate in SHOP, which is the Small Business Health Options Program. If your 25 or less employees make an average of $50,000 annually or less, then you might qualify for this tax credit, but only if you use SHOP. SHOP is a new federal health insurance marketplace for businesses that have up to 50 employees or so. This makes it possible for small businesses to provide health care plans for their employees, and you will control the coverage you offer your employees as well as how much you pay towards their premiums. SHOP will provide you with multiple plans and scenarios for your state so that you may browse your options and apply.
If your business has up to 50 employees:
If your business operate with 50 or fewer employees, you will also use the SHOP Marketplace mentioned above. Businesses of this size aren’t required to offer coverage, and there will be no penalty fee if you opt not to offer coverage. If you do wish to offer coverage with SHOP, control of what coverage you offer and how much you pay toward premium costs is completely up to you.
If your business has 50 employees or more:
There is an Employer Shared Responsibility payment that will be fully in effect come 2015. This payment applies only to employers with 50 or more full-time employees, who do not offer coverage. You will be required to notify your employees of the Health Insurance Marketplace and that they could be eligible for tax credit if they purchase insurance through the Marketplace.
