Employers Make Changes to Avoid Health Insurance Coverage

April 12th, 2013 by JBWK

Reporting on a widely popular trend, the Wall Street Journal ran a piece last week on small businesses’ strategies to address the health-insurance mandate kicking in next year. The new law requires employers with 50 or more full-time employees to begin offering group health insurance to all full-time employees (those averaging over 30 hours a week).

So what are these small businesses doing? It depends.

The owner of one foodservice company said he plans to pay the $2,000 per employee penalty, which is cheaper than the company picking up the $500,000 tab for group health insurance. Says the owner:

I’ve never made a profit in any year of the company that has surpassed that amount. I don’t make enough money.

Others, including a Pennsylvania-based home healthcare company, are paring hours down to force employees into part-time roles that wouldn’t make them eligible for mandatory insurance coverage. 

Another option is simply forcing employees to pay the bill themselves, leaving them with escalating costs expected to reach over $15,000 annually for family coverage.

Whatever the solution may be for any given employer, there will be many more shifts over the next several months.

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