Health Care Reform: The Affordable Care Act and What it Means for Texas Employers

The Patient Protection and Affordable Care Act (PPACA) federal statute was signed into law in 2010. The Act calls for comprehensive health reforms that enhance the quality and access to health care.

Starting in January 2014, PPACA affected some employers. This article describes which employers are impacted by the Patient Protection and Affordable Care Act, and what those employers will need to do.

Which employers are affected?

Employers with 50 or more employees will be affected by the Act.

If you plan on growing your startup, listen up. Your company may have 50 or more employees in the next two years.

What does the PPACA mean for you?

You will need to offer your employees qualified health insurance coverage. “Qualified” health insurance means the plan must cover 60% of health care expenses and premiums must cost less than 9.5% of employees’ household incomes.

Companies that are covered by the PPACA and do not offer qualified health insurance may be liable for annual fines up to $2,000 per employee.

Small businesses with fewer than 50 employees don’t have to meet the requirement and are exempt from having to offer health insurance.

Last notes

Many companies view health insurance as part of their overall compensation strategy. Employees often choose which company to join or leave based on the benefits.
As the economy rebuilds and the job market opens up, comprehensive health insurance plans could be a bargaining chip worth having.

Stay tuned for an article on health insurance options for startups.