As we draw closer to the date of implementation for the most important elements of the Affordable Care Act (“Obamacare”), employers are slowly hashing out how meeting the rules is going to change the benefits they provide to employees.
The federal legislation, the most important provisions of which go into effect in January 2014, requires that companies with more than 50 employees provide health insurance to full-time workers. For the purpose of the legislation, full-time is defined as 30 hours per week or more. Companies failing to provide this coverage so will be penalized at a rate of $2,000 per employee, and employees will receive a tax credit to buy their own insurance in the open market or the newly created state healthcare exchanges.
Many employers had hoped to include so-called “wellness programs” as part of the healthcare benefits package they provided to employees. These are programs that require employees to meet minimum standards of health – healthy blood pressure and blood sugar, for example – to earn themselves lower premium costs.
Labor unions and employee advocacy groups warned that employers could circumvent minimum healthcare coverage by including wellness programs as part of the healthcare coverage they offer, according to a Reuters article this week. It could also lead to less-healthy employees, or those with chronic conditions, being forced to pay more.
On Tuesday, the Internal Revenue Service (IRS) appeared to settle the matter. The federal agency’s newly released proposed rules governing the Affordable Care Act declare that employer-sponsored healthcare plans cannot include most "wellness programs" as part of minimum coverage requirements. The only exception is wellness programs that cover smoking cessation.
Advocates say it’s a victory for labor unions and consumer groups. The rules are not final, however. The IRS has opened a comments period that will last until July 2nd.
Edited by
Ashley Caputo
