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Health Care Reform


The health care reform legislation that was enacted in March 2010 has changed the way we all think about employer-sponsored group health plans. The new law is designed to increase federal oversight of health care plans and make health insurance more accessible to the general public to reduce the number of uninsured Americans. As the regulations continue to take shape, EBS will keep you up to date on how your plans may be affected.

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Federal Health Care Legislation Financial and Impact Analysis Tool and Penalty Calculators *

EBS has developed the Federal Health Care Legislation Financial and Impact Analysis as a working tool to identify the relevant mandates of health care reform and how they might impact your group health plan. The tool can help guide you through the implementation of the new legislation through ongoing technical guidance and support in the following areas:

  • Identification of minimum required and recommended plan changes;
  • Financial valuation of the future plan design and funding requirements;
  • Identification of administrative design and workflow changes;
  • Risk management and funding considerations;
  • Prevention and wellness program design; and
  • Development and implementation of management and employee communication strategies.

    • This tool and the corresponding analysis are frequently updated as regulations and applications of the provisions are further defined by the government. Please contact EBS at 713-629-9666 if you are interested in learning more about the tool.

    Using the Penalty Calculators

    Beginning in 2014, employers with the equivalent of at least 50 full-time employees (FTEs) may face penalties if one or more of their FTEs obtain a premium credit through a health insurance exchange. An employee may be eligible for a premium credit either because his or her employer does not offer coverage or the employer offers coverage that is deemed unaffordable or insufficient.

    Two calculators are available — one for employers that do not provide health care coverage for employees, and one for those that provide coverage. The tool allows you to estimate the total penalty that would apply to your company. Enter the following information in the calculator that applies to your company:
  • Number of FTEs;
  • Number of part-time employees (PTEs);
  • Aggregate hours worked by PTEs per month (e.g., if you have 30 PTEs who work on average 20 hours each per month, you would enter 600 in the calculator);
  • Estimated number of FTEs (excluding part-time and full-time equivalent workers) who would receive a premium tax credit through an exchange; and
    • Employees with income less than 400% of federal poverty level are eligible for premium subsidy
    • Employees who are offered coverage by an employer are eligible for premium credit if the employee's share of the premium exceeds 9.5% of income.


    The penalty calculators will estimate your FTE equivalent employees and your tax penalty that would apply to your company once health care reform's individual mandate goes into effect, starting in 2014. Although penalties will be assessed on a monthly basis, our calculator assumes the input values do not change over the year and reports annual values.



    * Information obtained from the Federal Health Care Legislation Financial and Impact Analysis Tool and Penalty Calculators and the EBS website is for informational purposes only. Calculated FTE equivalents and penalties are based on user-entered data and EBS’s application of the most recent provisions of the law. EBS Health & Welfare teams can provide a detailed analysis of your plans’ position with regard to health care reform compliance and assistance with implementing plan changes mandated by the legislation.
    • Employer Offering Health Coverage
    Number of FTEs
    Total monthly PTE hours
    FTE equivalents
    Number of FTEs receiving tax credit
    Penalty for FTEs receiving tax credit $3,000
     
    Potential Employer Penalty Tax

    Employer Not Offering Health Coverage
    Number of FTEs
    Total monthly PTE hours
    FTE equivalents
    Number of FTEs receiving tax credit
    Penalty for FTEs employed $2,000
     
    Potential Employer Penalty Tax