Most local businesses can breathe a sigh of relief when it comes to providing health insurance for their employees.
For starters, any business with fewer than 50 full-time equivalent employees is exempt from the mandate under the Affordable Care Act.
And according to the Internal Revenue Service’s website, the mandate for businesses with between 50 and 100 employees has been postponed to 2016.
But businesses with more than 100 employees have to meet it Jan. 1, 2015.
Local insurance broker, Ed Gussio of Benefit Logic confirmed the information.
“It’s called transitional relief,” he said.
Changes to the ACA in 2013 broke the original employer mandate deadline into two different businesses sizes, he said, one deadline for businesses with 100 or more employees and another for businesses with 50 to 100 employees or a combination of full- and part-time employees that falls in that range.
The change will give most Flagstaff businesses an extra year to find the best health insurance plan for their needs, Gussio said.
“Most of the businesses in Flagstaff with 100 or more employees probably already offer insurance plans for their employees, “ he said. “Most of the small businesses in Flagstaff have less than a 100 employees.”
NO CHANGES AT FMC
Northern Arizona Healthcare and its subsidiary Flagstaff Medical Center are two local businesses that fall under the 100 or more employee rule.
NAH Public Relations Director Trista MacVittie stated in an email that the organization did not have to change its insurance policy, but did have to make sure that the plan design met the ACA’s requirements.
W.L. Gore is another large, local business that falls under the rule.
Rose Marie Gallagher, of Gore's benefits team, stated in an email that "Ever since the Affordable Care Act was first introduced, we have been working carefully to ensure that we understand and meet all insurance requirements under this law. We also work continuously to ensure that Gore is well prepared to meet future ACA requirements, as new ones are introduced or as current ones evolve. At Gore, we are committed to offering our associates a comprehensive and competitive benefits package--one that not only meets the requirements of the law, but also goes beyond these requirements."
Nestle Purina, which also has more than 100 employees declined to comment.
There are some caveats to the 100-plus employee rule, Gussio said.
The first is in how the Affordable Care Act counts employees, he said.
According to the Internal Revenue Service rules on the ACA employer mandate, a full-time equivalent employee is someone who works at least 30 hours a week.
Some big box stores are attempting to reduce their healthcare premium costs by cutting off anyone who works less than 30 hours a week.
According to Bloomberg News, Walmart, Target, Home Depot and Walgreens decided not to cover employees who work less than 30 hours a week this year. Forbes.com added Trader Joe’s and Forever 21 to the list.
Target made its announcement on its blog, www.abullseyeview.com, in January 2014. Executive Vice President of Human Resources; Jodee Kozlak stated in the blog that the company decided to reduce its health care coverage because less than 10 percent of its part-time employees enroll in its health insurance. Kozlak also pointed out that those employees who would lose coverage might find better coverage on the state and federal healthcare exchanges. She also stated that the company would not be limiting hours for employees as a result of the change.
According to Bloomberg, Trader Joe’s was planning to offer any employee who lost coverage $500 to help pay for their own insurance.
CAPPED HOURS LISTED
Investors.com, which is operated by Investor’s Business Daily, has a list of 450 businesses, cities, school districts, counties and universities that have allegedly cut or capped hours for part-time workers in order to meet the ACA mandate. The list can be found at http://bit.ly/1qxaRBO.
Some of the Arizona-based entities on the list, which was created in September 2014, are the city of Yuma, Arizona State University, Maricopa Community College and the University of Arizona.
Northern Arizona University Public Affairs Director Tom Bauer said NAU does not plan to reduce the eligibility for positions that already qualify for benefits at the university.
“In 2013, to ensure that the university is in compliance with the Affordable Care Act, NAU implemented a rule that temporary employees, faculty and student workers (which are historically non-benefitted positions) must not average more than 29 hours a week,” Bauer wrote in an email to the Daily Sun. “Since they had not been receiving benefits, this will remain the same.”
Bauer stated that he was unaware of anyone from NAU losing coverage due to a cut in hours. Permanent employees who work 20 or more hours for at least six months are eligible for the university’s healthcare plan.
MacVittie of NAH stated in her email that “While the ACA mandates coverage for employees working 30 or more hours a week, we already offer benefits to employees who work less. Since we offer a variety of benefits to people based on a variety of hours worked, we did not see any big changes to our enrollment or plan participation with the 30-hour requirement. “
The company also did not see a change in how many hours employees worked.