Under the employer mandate of the Affordable Care Act (ACA), Fisher & Phillips attorney Sheldon Blumling notes that if you fail to provide adequate and subsidized healthcare coverage to all full-time employees and their families, you will generally be subject to a penalty of $2,000 per year, per full-time employee. So he urges employers to start now planning either to provide healthcare coverage in 2014, or figure out how to pay the penalties.
Another requirement that begins in 2014 is nondiscrimination: Your healthcare plan cannot discriminate in favor of highly paid employees. Here, too, a plan that fails this test could bring significant financial penalties. This provision was meant to kick in earlier, but interpretive regulations have been delayed. They're expected to be ready by 2014—some pundits have even speculated that the regulatory agencies will issue all delayed healthcare regulations in time for the 2012 presidential election. If you offer different plans, eligibility periods, or premium subsidies to different groups of employees, you will probably have to adjust your offerings to comply with the nondiscrimination requirements.
The final chunk of the ACA that deserves employers’ prompt attention is automatic enrollment. Remember that it applies only to companies with more than 200 employees, and it requires that new employees who are eligible for coverage be automatically enrolled in the employer's plan. If an individual doesn’t want to participate for some reason (such as coverage on a spouse’s plan), he or she must make the move to opt out, as opposed to the current system under which employees must opt in.
Blumling predicts that automatic enrollment will increase participation—a certain percentage of employees have historically neglected or refused to participate. As a result, most employers are likely to experience higher plan subsidy costs than in the past. But Blumling advises employers that some employees will receive government and elect coverage with the exchange(s) available in their state. As is true of the nondiscrimination rules, regulatory guidelines for automatic enrollment have been delayed but are likely to be ready by the start of 2014 or very soon thereafter.
Blumling comments that the greatest impact of the new parts of reformed healthcare coverage will fall on employers with between 50 and 250 employees. And, unlike other areas of labor and employment law, which can differ significantly depending on whether yours is a public or private organization, healthcare reform affects both public and private employers pretty much the same way across the board. So get ready!