Local business owners grapple with new health care law

By Anna Harris (File Photo)

Employers far and wide are grappling with the provisions of the nation’s new health insurance system, and Alexandria is no different.

A confused, concerned and curious group of local business owners attended a recent forum organized by the Alexandria Small Business Development Center looking for answers. Alexandra Piotrowski, the event’s speaker and an economic development specialist, hoped to dispel some of the fog surrounding what the health care overhaul means for them and their businesses.

Like many local small business owners, Kathy McAfee said her company, Curcio Law, isn’t really affected. But she lost her health care plan when it no longer complied with new regulations.

For individuals and businesses, the scariest part is the difficulty of understanding the law, she said.

“It’s just a lot of information that has not been given out. And too much misinformation,” McAfee said. “It’s everyone: the press, insurance companies, the government. The individual can’t complain. They have to do something about it themselves.”

So what do small businesses need to know about the new health care law so they can help themselves?

For one, it is not government-run health care, said Piotrowski.

The new law created a lot of rules and regulations that health care providers need to follow, but “government-regulated” isn’t “government run,” according to Piotrowski. She also said it isn’t universal health care, though the overhaul requires most individuals who don’t have coverage by January 1 to pay the individual shared responsibility provision (some exemptions apply).

As for employers, not all are required to provide health insurance coverage for their employees.

Health care coverage doesn’t fall under a company’s legal obligations. If a business does choose to offer coverage, its responsibility only goes as far as its full-time employees.

If a company chooses not to provide coverage, it might be required to pay the shared responsibility fee (also known as the business mandate) after January 1. Even then, only businesses meeting specific criteria pay.

If a business has 50 or more full-time (or full-time equivalent) employees and any of them gets a premium tax credit on the individual marketplace — or if the employer does offer coverage but it’s not affordable or doesn’t meet minimum-required coverage — then the fee applies.

Employers should keep track of two things, Piotrowski said. The first is how many full-time workers the business employs — 50 or more is the first trigger for shared responsibility payments. The second is employees’ average salaries, which indicates whether or not they are eligible for the premium tax credit.

Employers don’t owe any shared responsibility payments if they choose to offer health care coverage. Exemptions also exist if a business has fewer than 50 full-time or (full-time equivalent) employees, the company’s gross income doesn’t allow it or an employee doesn’t receive an individual tax credit.

Ninety-six percent of small businesses won’t have to worry about it, Piotrowski said, as they don’t meet these standards.

If the fee does apply, the employer pays for all full-time employees minus the first 30. For example, if a restaurant has 25 full-time employees and 50 part-timers, the fee doesn’t apply. There aren’t even 30 full-time workers.

But in the case of a pet store with 35 full-time employees and 50 part-timers, the business must pay for five full-timers.

Despite Piotrowski’s detailed explanation, and the promise of more sessions to come, the presentation left many with additional questions.

McAfee said she came because she wanted to understand the health care overhaul. Despite her anger that the law made her previous plan obsolete, she said that the new health insurance system is here to stay, so she might as well deal with it.

“[Health care] is in there now, so we need to get on it,” she said.

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