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Apr 17, 2013HR Outsourcing

Healthcare Reform - The Basics

Healthcare Reform - The Basics

Political seasons light up year after year with another goal to be achieved. When politicians started talking about healthcare reform, many were puzzled about the total effects it would have on them. Today, healthcare reform is no longer just a buzzword used by an overzealous person, but a reality. If you are unsure what and how it will affect you.  Don’t panic. Let’s talk the basics first.

Healthcare reform is single- handedly the biggest piece of legislation to hit employers in any of our lifetimes. The federal health care reform has established a new set of standards for how and to whom employers offer health insurance. With that being said, it is vital that you and your organization stand prepared for the new provisions coming your way. 

Some of the new provisions include: a new definition for full time employee, affordability aspects and coverage ability. With these new provisions, it is now more important than ever to have a unified HR platform.

“Oh great,” You think, “new provisions, new definitions… Fill me in.” Here’s the skinny…

What is a full- time employee?

A full-time employee is any employee who averages 30 or more hours per week in the look back period or 130 hours a month. Once you understand the new full-time employee status, it is vital that you not only offer coverage, but that you offer affordable coverage.   Failing to do so can result in a large penalty. Premiums cannot be more than 9.5% of an employee’s W-2 box 1.

Employers must make that coverage available. Failure to do so will result in a penalty for each employee if any ONE employee receives subsidized coverage through an exchange. Seasonal employees can possibly be excluded by using the look-back/stability period safe harbor.

If your organization has multiple variable hour employees, the first question to ask yourself is can your HR system identify these employees? Once identified, can your system accommodate eligibility that is based on prior hours worked rather than scheduled hours at present? This is a critical piece to think about because the regulatory requirements of the Affordable Care Act are placing significant pressure on employers to develop innovative strategies in order to reduce exposure to costly penalties.   

If you are like most people, paying penalties when they could have been avoided is frustrating. Basically, your HR Software has to have the capabilities to ensure that all potential problems get flagged and fixed before it really costs you. Being on a unified HR platform eases those stresses. 

OneSource Virtual has the capabilities to make this process seamless for you. We offer communication of Exchange to eligible employees through preconfigured business process at the time an employee becomes eligible. So what are you waiting for? Contact OneSource Virtual for more information about your health care reform needs!