2013 Obamacare mandates

Now that implementation of the Patient Protection and Affordable Care Act (Obamacare) is poured in concrete, it is critical for employers to understand and comply with the administrative impact of the legislation. Below is a summary of the legislative requirements effective January 1, 2013:

• W-2 reporting for benefits provided during the previous year. Employers with over 250 W-2’s will be required to report the total cost of coverage under and employer-sponsored health plan. This information is intended to provide employees information regarding the actual cost of health insurance. The employer contribution is not taxable at his point.
• Flexible spending account contribution limits are reduced to $2,500 annually. This amount only applies to employee contributions and does not cap employer matching or other contribution programs.
• Medicare tax will increase for high earners. The current Medicare tax rate of 1.45% will increase to 2.35% for all wages over $200,000 for single filers, $250,000 for joint filers, and $125,000 for persons who are married filing separately. Employers are not required to consider the spouses wages or an employee’s wages at a second job. The tax would begin at the point the employee’s annual wages exceeds $200,000.
• First dollar coverage for women’s preventive care services is required. Companies will be prohibited for imposing co-payments, deductibles or other cost-sharing mechanisms for certain women’s preventive care services including contraceptive methods and counseling.

In addition to the January 1, 2013, changes, effective March 1, 2013, employers will be required to provide notices to employees regarding state health insurances exchanges which must be operational in 2014.

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