2013
I did not write the following article although I wish I had. It provides a good real world explanation of the impact of the Affordable Care Act on small business. Check out the full story via the link below.
However, we must also view this from the workers perspective as well. One way or the other they will gain coverage and one way or the other they will lose money either in lower pay or new insurance premium costs (compared with current out of packet health care costs). There is no free lunch here, it’s not all good or all bad for either party.
To illustrate the choices that companies face under the Affordable Care Act, consider a hypothetical firm, Florida Inc., that employs 52 full-time employees with an average salary of $55,000. Currently, the firm offers health care benefits only to 10 senior managers, paying 100% of premiums at an average cost of $5,500 per manager.
Under the Affordable Care Act, companies with more than 50 workers are classified as large businesses and are required to either offer comprehensive coverage health coverage to all full-time workers or pay a penalty.
What are Florida Inc.’s options in complying with the new law?
via An Affordable Care Act case study | Health Care Insurance – Florida Trend.
Related articles
- White House Delays Affordable Care Act Employer Mandate Until 2015 (turbotax.intuit.com)
QUINNSCOMMENTARY 
Nope, the best alternative is not any of the suggestions shown.
The best alternative for that employer is likely to be:
Offer a bare bones minimum benefit to all full time employees, that would be a plan with a $6,350 individual deductible, twice that if they elect to cover a dependent (100% preventive services), then 100% coinsurance. Charge an employee contribution equal to 9.5% of pay for single tier (up to 100% of the cost of coverage), and, where the individual elects family coverage, 100% of the cost of family coverage.
No one enrolls other than the 10 highly paid employees/executives who currently have coverage because the employer increases their compensation by the amount of the increase in employee contributions, plus the employer may shave a couple of basis points off the merit budget for the lower paid employees to pass along to the executives (slight tax differentials). The executives fully fund their Health Savings Accounts, and, … actually improve their benefits compared to the more traditional PPO they were offered in the past (based on the $5,500 cost of coverage for single employees). .
The executives get more, the workers get an offer of coverage they cannot afford to select, the status quo continues.
Of course, the employer can do the lower paid employees a favor and offer a second option, minimum essential coverage, of self-insured preventive services, @ 100% employee pay all rates, so as to allow the worker to elect coverage and avoid the inidividual mandate penalty tax.
What a deal!
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What a deal indeed!
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