Employers concerned about their obligations under the Affordable Care Act (ACA) should consider alternative approaches that may exempt them from providing health insurance to all employees, according to Charles Wachsstock, an employee benefits attorney at Debevoise & Plimpton.
In a webcast sponsored by the Practising Law Institute, Wachsstock noted that employers that do not provide health coverage only incur government penalties if an employee gets a tax credit for purchasing insurance on a government health care exchange, Thomson Reuters reports.
Not all employees are eligible for said credit, however. Only workers whose salary is four times the federal poverty credit or less—$45,960 for an employee without a family—qualify for the exchange credit. Thus, businesses looking to trim health care costs—and avoid government fines for noncompliance—can do so by not providing insurance coverage for workers who make more than that amount.*
Wachsstock also noted that employees and their families may get better insurance rates on government-run exchanges if they do not receive coverage from an employer.
*Correction: The article originally stated that companies looking to trim health care costs could do so by not providing insurance coverage to workers who earn less than the threshold amount.
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