Patient Protection and Affordable Care Act or often called with Affordable Care Act (ACA) has been signed into law since the era of Obama. Now, businesses within the United States should obey under the act for not getting the penalty. There are 2 conditions when the ACA affect businesses depending on the number of the employees.
Smaller Businesses with Fewer Than 50 Employees
Small businesses with fewer than 50 employees don’t require provide healthcare coverage for employees under ACA. However, they may be eligible through a state or federal insurance exchange. Meanwhile, for small businesses with fewer than 25 employees that choose to provide insurance anyway, may be eligible to the Act under tax credit to provide health care coverage offset the cost.
Big Businesses with More Than 50 Employees
Basically, the major provision of the ACA affects largely to big businesses with more than 50 employees. They are subject to the Employer Shared Responsibility Payment. They must offer the insurance or provide affordable health insurance coverage to full-time employees. The “affordable” means the employer must pay for at least 60% of health care expenses and the employee doesn’t pay more than 9.5% of their family income.
If the employer doesn’t provide healthcare coverage or offer affordable coverage, they will face a serious penalty. The amount of penalty is $2,000 per worker for each full-time employee deducted by 30. For example, a company has 100 employees, so the penalty only subject to 100-30=70 employees. So, the company must pay the penalty of (70x$2,000) $140,000 per year.
Providing health care coverage for employees is an important matter for the employer since the federal protecting the workers under ACA. So, it is important to take care more about this matter. You can save your company from the huge penalty that may cause a big loss. When you don’t want to deal with complicated exchange notice process, there is ADP Workforce Affordable Care Act will help you to get the right counts.