Under the 2010 Affordable Care Act, employers with more than 50 full-time equivalent employees are required to provide group health insurance that meets ACA standards to their full-time employees. Since President Donald Trump took office in early 2017 there have been several attempts to repeal and replace the ACA.
Although attempts to repeal the ACA in its entirety have been unsuccessful, there have been changes made to the ACA under President Trump. This has many asking what these changes mean for employer health insurance requirements.
Do Employers Still Have To Offer Health Insurance?
The main change made to the ACA as of 2019 is the repeal of the individual insurance mandate. The employer shared responsibility provisions of the ACA remain unchanged. This means businesses with 50 or more full-time equivalent employees must continue to offer employer-provided health insurance to full-time employees as part of their employer benefits package.
Employer Coverage Requirements 2019
Employer-provided health insurance must meet the employer health insurance requirements set forth in the ACA. These employer health insurance requirements state that a large employer must either offer minimum essential employer coverage that provides the minimum standard of value to full-time employees or face potentially incurring IRS penalties for failing to do so.
In order to meet these standards employer coverage must cover at least 60% of the total allowed costs of the employer benefits and cost 9.5% or less of a full-time employee’s household income.
What Happens If Your Employer Doesn’t Offer Health Coverage?
If your employer has 50 or more full-time equivalent employees and doesn’t offer employer-provided health coverage they may incur penalties. The employer will incur penalties if they don’t offer employer coverage and at least one of their employees gets coverage in the exchange with a premium subsidy. This penalty is $2,320 per full-time employee, excluding the first 30 employees.
Declining Employer-Sponsored Coverage
Prior to the repeal of the individual insurance mandate and employee was only able to decline the group health insurance offered by their employer during the Open Enrollment period. With the repeal of the individual mandate, you are free to decline employer-provided health insurance at will and seek coverage in the individual insurance market instead.
However, if you decline the group health insurance offered through your workplace, and the coverage offered meets the ACA standards, you will not be eligible for premium subsidies in the marketplace. This means insurance bought in the marketplace will likely be less affordable than your employer’s health plan.
What Are Your Other Options?
If you’re not a fan of the group insurance options offered by your employer, you do have alternative options you can look into. Let’s take a look into what that includes, and which plan may be the best fit for you and everyone else you plan on adding to your policy.
Private Individual & Family Coverage
Private individual insurance is coverage you select and pay for yourself. You can enroll in an individual insurance plan during the annual open enrollment period. This allows you to select a health insurance plan that suits your needs. If your employer does not provide affordable minimum health coverage you may be eligible for premium subsidies.
Short-Term Health Insurance
Short-term health insurance plans provide individual health coverage for a defined time period which can be up to 364 days. These plans are more affordable than traditional health insurance and can be used to pay for services at any hospital or doctor’s office.
You can enroll in a short-term health insurance plan at any time during the year. This is a good option for generally healthy people or for people who missed the open-enrollment period and need coverage until they can enroll.
Insurance Co-ops
Co-op health insurance plans serve a small group of people whom they are also owned and operated by. There are no hierarchies in health insurance co-ops so all members receive the same coverage. These co-ops are often less expensive than traditional health insurance while offering comparable coverage. The downside to these co-ops is that because many of them are ideologically motivated there may be certain procedures they won’t cover due to their beliefs.