Sunday, October 13, 2013

How do I know if our health plan is affordable under the Health Reform Law?

The employee portion of the monthly premium cannot exceed 9.5% of his or her Modified Adjusted Gross Income.

What is considered in the Affordability Testing?


For the Affordability Testing, you'll look at 1) what the employee pays toward employee-only coverage (not family coverage) 2) the employee's annual income (not the household income).

Originally, the intent of the law was to ask employers to gather income from the employee's entire family and calculate affordability of the family premium, but it was determined that it would be too difficult on the employer and leave too much room for error. The unintended consequence of this change was that many families who would have qualified for subsidy will not be able to use it if the employee passes the Affordability Test.

How do we handle the testing?


You don't have to because we will. Our experts will determine if your plan is affordable for each employee. And if it's not, we will show you several different strategies and advise you on which option is best for your business.

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