A new day is how the U.S Department of Health and Human Services describes Jan. 1, 2014 “for the 19% of Arkansans who don’t have insurance, or Arkansas families and small businesses who buy their coverage but aren’t happy with it, a new day is just around the corner.”
If you live in Oklahoma, don’t fret. It’s a new day for 20% of Oklahomans who don’t have insurance. (Dang! Arkansas came in last again.)
For some reason, reading the verbiage on government websites about the upcoming implementation of the Affordable Care Act makes me nervous. On the IRS website you’re told “all you have to do is educate yourself by going to the Health Insurance Marketplace on HealthCare.gov. If you and your family have health care coverage, you may not have to do anything different in 2014.”
I suppose reading these statements make me nervous because as a CPA working with businesses, I read about requirements that businesses are now required to comply: reporting employer provided health coverage in Form W-2, net investment income tax, additional Medicare tax, determination of whether an eligible employer-sponsored health plan provides minimum value and how that relates to the administration of the premium tax credit and application of the employer shared responsibility payment, the small business health care tax credit, application of the Affordable Care Act to health reimbursement arrangements, changes to the itemized deduction for medical expenses, health insurance premium tax credit, individual shared responsibility provision, etc.
And this is only a partial list of areas administered by the IRS.
Dang! It is a new day!
There are already volumes of misinformation being retold again and again to friends and neighbors. Although I expect the government to be kind to non-compliant individuals and businesses in the beginning, learning about the Affordable Care Act isn’t as simple as reading the answers to frequently asked questions over on healthcare.gov.
For example, how many small business owners with at least one employee are aware that if they are covered by the Fair Labor Standards Act (FLSA) they must provide each employee with a written notice by Oct. 1 about the health insurance exchanges? How many small businesses even know if they are subject to the FLSA?
I’m finding a great number of small businesses are not aware of this notice requirement.
Briefly, let’s review the requirements.
If you are a small business with at least one employee with annual sales of $500,000 or more, you are covered by the Fair Labor Standards Act.
If you are covered by the FSLA, you are required to provide each current employee with a notice by Oct. 1 informing them of the existence of a state insurance marketplace, a description of the services provided by the marketplace, instructions for the employee on how to contact the marketplace, a statement that the employee might qualify for the premium assistance tax credit, and a statement that if the employee buys a health insurance plan through the marketplace they may lose an employer contribution to any health benefits plan offered by the employer. After Oct. 1, an employer is allowed 14 days to provide a new hire with this same notice.
The good news is that complying with this notice requirement is simple. The U.S. Department of Labor provides model notices on their website. Download the model notice applicable to your business, modify the notice by adding your business’ contact information, print on your letterhead, then distribute this notice to your employees.
Follow these procedures and you’re now compliant.
15 days and counting! The pre-game show, the opening of the health insurance exchanges, has long been anticipated and on Oct. 1 the curtains will be opened and the public will be shown the results with cost and coverage options, copays and out of pocket costs. Also, insurance plans with metallic descriptions will be unveiled.
The confusion and the misinformation about Obamacare will intensify. But that’s been the nature of the Internal Revenue Code all your life. In 10 years this stuff will seem normal.
I just hope it really is a new day for the uninsured and underinsured, and that lives will be saved or improved, because it will be costly for employers to administer.