We had been pondering a blogpost on Obamacare when the good ol’ biased New York Times rode to the rescue with an article on how companies over 50 employees are adjusting to Obamacare, having missed a major option for such companies.
1. We agree that they’re going to have to provide insurance, but what the NYT missed was the fact that the business in question can ask the employees if they want the insurance. They may not, because they’ll have to pay something, or they’re on their parents’ insurance, etc. Big difference here.
2. If the employees opt out of being covered, as many have in the fast food industry, per a recent Wall Street Journal article on compliance with Obamacare in the land of fries and burgers and pizza, the employer can actually pay the $95 fee the individual would have incurred, through payroll deduction at the end of the year. We’re sure there are rules about explaining this to employees, too.
3. There’s also the more cynical view that the whole Obamacare structure may collapse into itself, due to funding problems, the government not having its act together on insurance exchanges and God knows what else we may find before the end of 2013.
4. Companies must be careful in reclassifying employees as contractors to not run afoul of IRS regulations on what constitutes an employee. Regular routes, regular hours and employer provided equipment, such as a delivery van, make an employee, not a contractor.
5. The NYT article assumed the company had no insurance coverage at this point. If it does, or did, there’s just a burden of proof on the company that its insurance coverage is as good as Obamacare minimum coverage. We think most employers can ropeadope this requirement into mid 2014 or beyond, because the value of healthcare has to be added back on corporate tax returns even now, so it’l take the IRS a year or two to figure out a comparo between your plan and min coverage.