Maximum Fines of $500,000 Under Health Care Reform
Employee Benefits Expert Explains New Fines For Businesses Effective Sept. 23 Under Health Care Reform
PLAINVIEW, NY (MMD Newswire) September 21, 2010 -- With 45 million Americans without Health Insurance, the Health Care Reform Bill aims to reduce the number of Americans without Insurance. However, an overlooked section in the Health Care Reform Bill fines businesses up to $500,000 for offering Health Insurance to only the top employees and no one else.
Staring Sept. 23, 2010, the Health Care Reform Bill requires businesses that offer health insurance, to provide insurance to at least 70% of the employees. The fine for companies with over 50 employees is $100 per day per person or 10% of the annual premiums which ever is less; up to a maximum of $500,000.
Brett Goldstein, a Plainview, New York-based employee benefits expert and President of The Pension Department, states, "Many small businesses have health insurance only for the owners and top employees; rank and file employees may not be offered health insurance. However under the new law, offering health insurance to just a few key employees can bankrupt a small business. The fines for a small business could be well over $30,000 per year."
Health Insurance plans that existed on March 23, 2010 are considered grandfathered and don't have to pass the 70% test. However health insurance plans that have significantly cut benefits, changed insurance companies or increased out-of-pocket spending, since March 23rd, will have to pass the 70% test every year or pay the fines.
Goldstein says, "To make matters worse, if you don't pay the fine there is a penalty. The maximum penalty for not paying the fine is $250,000. However there is some relief for smaller businesses. Businesses with less than 50 employees still have to pass the 70% test every year, however they don't have to pay the fines."
To avoid these fines and penalties, Goldstein suggests that business owners call their Insurance Company or their insurance agent to find out if they are grandfathered or contact professionals who can perform the required annual 70% test.
About Brett Goldstein
Brett Goldstein is a Pension Administrator and President of The Pension Department, a consultancy based in Plainview, New York. He is a speaker and media personality who specializes in providing businesses and individuals with affordable retirement planning solutions. Goldstein's timely advice and tips have been featured on Fox Business Network, Kiplinger's, Wall Street Journal Radio, MarketWatch.com, New York Daily News, The Chicago Tribune, and many others.