Can a business with 51+ employees which offers health insurance still be penalized?
The answer is YES.
If an employeer offers “unaffordable” health insurance to his/her employees the company will be fined. The fine for offering unaffordable health insurance is $3,000 per employee. If you have 60 employees and are found to offer unaffordable health insurance you will see a fine of $90,000. (This penalty is the same as the others and does not apply or get calculated for the first 30 employees.)
So what is considered unaffordable health insurance? If the employee’s portion of the monthly health insurance premium is 9.5% or more than the employee’s gross monthly income, then it is deemed unaffordable. If it is less than that threshhold, it is affordable.
Employee X’s portion of the monthly premium is $500. Her gross monthly income is $4,000. This would equal 12.5% of her gross monthly income. This would be considered unaffordable and subject to a $3,000 fine. This would also open the employeer up to an audit to see if the rest of his employees have unaffordable health insurance.
Health care reform is real; lets make sure you know what to expect!