Obamacare and You

By Sandy Botkin

You have probably heard the saying, 'No good deed goes unpunished." This seems to be very true with Obamacare. Under the new law, if you have less than 50 employees, you don't need to provide health insurance. However, if you do provide health insurance or even worse, reimburse employees for their premiums, it could be a VERY costly mistake. How costly? How about $36,500 per employee! Yes, I am not kidding.

Here is what you need to know: If you provide group health insurance for all your employees, you are in full compliance with the law. This is true whether you use a private exchange or go anywhere else; you won't have a problem with the law. However, if you provide insurance for some of your staff and not others, or even worse, you reimburse your staff for their purchase of insurance, now you have some big problems. Prior to 2014, you could have done this through a health savings account or a self-insured medical plan. Now you can't reimburse them for their premiums.

The second surprise is that you can't offer a self-insured medical plan to any employees who aren't covered by your group health insurance or you can be subject to severe penalties. This type of plan reimburses them for medical expenses not covered by insurance. However, there are exceptions where you can offer the employee coverage under a self-insured medical plan IF:

* They were offered insurance coverage but declined it because their spouse had the coverage with another company; or
* It is for benefits not covered by Obamacare such as dental, vision care, etc.

Bottom line, if you have more than one employee, then in order to pay for some or all of the employees' health insurance, you MUST buy group health insurance. Thus, you have two choices regarding your employees:

1. Buy group health insurance, or
2. NOT pay for health insurance premiums (assuming you have fewer than 50 employees).

And don't offer a self-insured medical plan unless you either cover these employees with health insurance or they elect out of coverage since they are covered by a spouse's plan or you are covering them for expenses not covered under Obamacare such as dental, vision care, etc.