Affordable Care Act Penalties for Employers
The United States Treasury Department has issued new regulations applying to large employers. For those with more than 50 employees, the employer faces penalties for every employee who elects federally subsidized coverage, up to $3,000 annually but prorated per month. Large employers will face decisions about how much employees will be contributing to their health insurance coverage. The difference is that according to the Department, the 9.5% threshold under the Affordable Care Act applies to the individual’s coverage, not family coverage. Under the ACA, an employee may opt for the federal subsidy if unable to get affordable insurance through the employer, and affordable is defined at this 9.5% threshold. This ruling has the potential to save the federal government money if fewer people opt for coverage through insurance exchanges. The effect on business, of course, would be the opposite.