Key Provisions of the Affordable Care Act (ACA)
Beginning in 2014:
All individuals will be able to purchase coverage regardless of health status.
Health Insurance Marketplace
Individuals will be able to purchase individual health coverage on public exchanges called the Health Insurance Marketplace. These exchanges will offer a variety of health plans identified by metal tiers based on their actuarial value.
Qualified health plans sold on the Health Insurance Marketplace are required to cover the essential benefits. The law also requires that an employee's contribution to the group premium not exceed 9.5% of his or her income.1
Additionally, if your organization is not grandfathered, you may need to transition from your current coverage to one of the metal tier plans.
Two types of subsidies will be available to eligible individuals:
- Premium subsidies for individuals with household incomes at or below 400% of federal poverty level (FPL)2.
- Cost-sharing subsidies to help with immediate out-of-pocket costs for those below 250% of the FPL.
Beginning in 2015:
Coverage is Mandated for Large Groups
All employers with 50 or more full-time equivalents are required to offer affordable coverage to full-time employees. The employer mandate became effective January 1, 2015 although there is transition relief for certain employers with fewer than 100 FTE employees.
All employers with 50 or more full-time equivalents must provide adequate, affordable health benefits to employees or pay a $2,000 penalty per full-time employee per year. Employers with fewer than 50 full-time equivalents can offer health benefits or send their employees to the Health Insurance Marketplace, with no regard to penalties.
1) If standards are not met, the employee is eligible for subsidies and the employer pays a $3,000 penalty per employee receiving marketplace subsidies
2) In 2015, $47,080 for an individual and $97,000 for a family of four (source: http://aspe.hhs.gov/poverty/15poverty.cfm)