Being a small employer has its challenges, especially in 2020. You may have experienced closing your doors completely, changing your business model to serve the public with new COVID-19 restrictions, or thriving in an online marketplace. Whatever your challenges were in 2020, you can be guaranteed that more changes are on the horizon. Let’s just hope they are a little better in 2021!
The Supreme Court of the United States (SCOTUS) heard Texas vs. California in early November. The 90-minute discussion, filled with many questions from the Justices, was a fascinating show of how our judicial system works at the highest levels. The question on the minds of smaller business owners: Will the Affordable Care Act (ACA) change after SCOTUS rules on this case in the summer of 2021?
This court case will determine a few things, will the entire ACA be kept intact, will the individual mandate fall, will the employer mandate fall, will pre-existing condition provisions remain for Americans?
Let’s start with some predictions. I do not believe that the ACA will be terminated in its entirety. This means that small employers (those with less than 50 employees), will still get a “pass” from paying a penalty if they do not offer insurance. Employers with more than 50 eligible employees will still be penalized if they do not offer health insurance, offer the wrong kind of insurance, or offer unaffordable insurance to their employees. Those fines continue to increase year after year and there is also a penalty for not filing a 1094 or 1095. Audits are currently being conducted for applicable large employers (ALE) by the IRS for 2018. If you are an ALE, or think your company might become an ALE, make sure that you are in compliance with the ACA to avoid any penalties.
If the SCOTUS does eliminate the individual mandate, not much will change. You see, Congress has already done away with the individual mandate penalty and the IRS does not require you to show proof that you had insurance on your tax return. So, if SCOTUS repeals the individual mandate, your small or large company will continue to function as is.
As for eliminating pre-existing conditions protections – nobody wants that to happen. Not Congress nor the current Presidential administrations. There is simply no appetite in Washington D.C. to eliminate it. Americans certainly do not want to lose this protection under the ACA.
The best way to stay compliant is to invest in a compliance tool. A compliance solution is invaluable to small businesses because it ensures nothing falls through the cracks. This tool can be implemented within the organization to provide a system of checks and balances to help employers keep up to date on the latest ACA regulations, track data in real-time to support decision making, and complete and file IRS and other compliance forms.
If you are a small business owner, you need to make sure that you are following the provisions of the ACA that apply to you. You want to be in compliance with ERISA, COBRA or state continuation, and that you are providing all of the notices required under federal law. An insurance broker is a great resource for small business owners. A broker will help businesses evaluate their coverage options to ensure they are compliant with federal and state regulations.
Misty Baker is an Affordable Care Act Compliance, Agent, and Industry Advocate. Misty is an Affordable Care Act compliance and agent advocate, specializing in ACA, ERISA, FMLA, COBRA and legislative advocacy for more than 15 years. She was a registered lobbyist in Texas for 4 years. She is a strategic leader focused on compliance, agent knowledge, legislative advocacy, and ultimate client understanding of how to be successful in the changing world of compliance. Her passion incudes agent education, insurance advocacy inside and outside of the Capital and compliance.