ACA Talking Points for Small Businesses


On January 1, 2014, the new health care law went into effect requiring most Americans to have health insurance.


If you are a business owner with fewer than 50 full-time employees, you are not required to offer health insurance.

However, employees must have health insurance or they could be hit with a tax penalty.

Business owners have options if they want to help employees afford insurance.


An ALE (Applicable Large Employer) is an employer with 50 or more full-time employees.  The employer mandate is phased in.

Businesses with 50-99 full-time employees are liable for Employer Shared Responsibility Provision (ESR) and must offer insurance beginning on 1/1/16 or face a penalty when filing 2016 taxes.

Employers with at least 100 full-time employees liable for ESR beginning in Tax Year 2015.

Do all businesses have to provide health insurance?


That depends on the number of employees. If you are a small business with fewer than 50 full-time employees, you are not required to provide health care insurance under the Act, but there are tax incentives available if you do.


Due to various extensions and delays, employers with at least 100 full-time employees must cover employees or face a penalty beginning in Tax Year 2015. Employers with between 50 and 99 full-time employees must cover employees or face a penalty beginning in Tax Year 2016. 



How do I help my employees?


Providing health insurance can help you attract the best people and keep them healthy and productive. Plus, as of January 1, 2014 for employers with over 100 employees, it is the law. But we know it's expensive. Good news! You have several options to help them get coverage...affordably. Learn More


How does the government define a "full-time" employee?


A full-time employee is an employee with at least 130 hours of service in a calendar month. 

Do employees need to have health insurance?


Yes, however exemptions may be granted to those who:


Earn less than the income amount required to file taxes ($10,300 for an individual)

Belong to certain religious sects

Belong to a health sharing ministry, or American Indian tribe

Are undocumented

Are incarcerated

Could not find "affordable" coverage that costs less than 8.05% of their income

Experience a hardship that prevents them from obtaining coverage 


What happens if employees don't have insurance and aren't granted an exemption?


They will be subject to penalties. The 2015 penalty for not having health insurance is as follows: $325 per adult and $162.50 per child (up to $975 per family), or 2% of the annual family income, whichever is greater. The penalty will increase until 2016.

Will there be financial help available to employees who can't afford insurance?


Yes, government subsidies will be available for low and moderate-income families who buy a Marketplace plan and don't have other affordable coverage options available.

Note, if an employee of a business with 100+ employees uses government subsidies to purchase insurance, the employer will be penalized.   

What documentation must employers provide to their employees about their healthcare to ensure they can file their taxes?


Beginning in 2015, employers with 50 or more full-time employees are required to file Form 1095-C, Health Insurance Offer and Coverage Statement, with the employee and the IRS. The form includes information about whether an employer offered qualifying health coverage to an employee, spouse, and dependents for some or all months during the year. Form 1095-C is used to determine: 


Whether the employer shared responsibility provision applies,

Whether the individual shared responsibility payment applies, and

To help employees evaluate eligibility for premium tax credit.