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Texas, Louisiana & Oklahoma

Group Insurance Affordable Health Care Act


Top Things to Know for Small Businesses


   If you have up to 25 employees, pay average annual wages below $50,000, and provide health insurance, you may qualify for a small business tax credit of up to 35% (up to 25% for non-profits) to offset the cost of your insurance. This will bring down the cost of providing insurance.

   Under the health care law, employer-based plans that provide health insurance to retirees ages 55-64 can now get financial help through the Early Retiree Reinsurance Program. This program is designed to lower the cost of premiums for all employees and reduce employer health insurance costs.

   Starting in 2014, the small business tax credit goes up to 50% (up to 35% for non-profits) for qualifying businesses. This will make the cost of providing insurance even lower.

   In 2014, small businesses with generally fewer than 100 employees can shop in an Affordable Insurance Exchange, which gives you power similar to what large businesses have to get better choices and lower prices. An Exchange is a new marketplace where individuals and small businesses can buy affordable health benefit plans.

   Exchanges will offer a choice of plans that meet certain benefits and cost standards. Starting in 2014, members of Congress will be getting their health care insurance through Exchanges, and you will be able to buy your insurance through Exchanges, too.

   Employers with fewer than 50 employees are exempt from new employer responsibility policies. They don’t have to pay an assessment if their employees get tax credits through an Exchange.

The Affordable Health Care Act requires health insurers and group health plans to provide consumers an accurate summary of benefits coverage at the time of application, enrollment, and yearly upon re-enrollment.Beginning March 1, 2013, employers must provide employees written notice:

   Of the existence of the state health insurance exchange;

   Of their potential eligibility for federal assistance if the employer's plan is "unaffordable";

   And that they may lose the employer's contribution to health coverage if they purchase health insurance through the state health insurance exchange.

Employers are required to report the cost of health insurance coverage for calendar year 2012 on employees' 2013 W-2 forms.

Student health insurance plans would be allowed to have annual dollar limits on essential health benefits of no less than $100,000 for policy years beginning before September 23, 2012.

Medical Loss Ratio (MLR) Rebates

 Starting August 2012, premium rebates are provided to enrollees if their insurer does not spend 80 to 85 percent of premium dollars on medical care and health care quality improvement, rather than on administrative costs.

To determine MLRs and potential rebates due, health insurance companies collect information from each employer group on their average number of employees during the preceding calendar year.

FSA Changes

Beginning on Jan 1, 2013, contributions to FSAs will be capped at $2,500 per year. The threshold for deducting medical expenses on taxes goes from 7.5 percent to 10 percent of income.

Minimum Essential Coverage

All U.S. citizens are required to maintain minimum essential health coverage each month or pay a penalty. Employers with an average of at least 50 full-time employees in the prior year must offer minimum essential coverage to employees.

Guaranteed Issue

All carriers in the individual and small group markets will be required to offer coverage to any individual or group that applies, and plans/policies are guaranteed renewability.

Tax Credits

Affordable Care Act increases the small business tax credit to 50% of employer cost for providing employee health coverage (35% for tax-exempt employers).Credits will only be available on plans offered through health insurance exchanges. Tax credits are also provided to individuals purchasing coverage on the exchanges.

Essential Benefits

No more lifetime or annual dollar limits are allowed on essential health benefits.

"Cadillac Plan" Tax

Affordable Care Act imposes a 40% excise tax on high-cost employer sponsored health coverage, or plans with an annual cost exceeding $10,200 for individuals or $27,500 for a family.