Filed Under:Your Practice, Regulatory

Companies with ‘discriminatory’ plans face PPACA fines

If you’re a top gun at your company, you may have a ticking time bomb in your array of health benefits that could go off with a jolt come January.

That’s because any employer that offers “richer” health benefits to certain employees faces a penalty for doing so if those packages aren’t purged of what’s deemed discriminatory coverage by the time the Patient Protection and Affordable Care Act takes full effect.

Although the provision hasn't drawn as much attention as other parts of the PPACA, the Small Business Coalition for Affordable Healthcare has lobbied against it, telling the IRS the penalties "fall especially hard on the small business population." 

The PPACA sets out some guidelines for what will be considered discriminatory health coverage. A “highly compensated” individual, for starters, is described as any shareholder who owns more than 10 percent of a company's shares, someone who is among the top five highest-paid employees in a corporation, or someone whose compensation puts them in the top quarter of employees.

Employers offering high-priced benefit plans to their workers also are subject to the law's “Cadillac” tax.

According to the Medical Plan Trends Report, produced by benefit-management firm HighRoads and the member-advisory firm CEB, about 16 percent of plans are on track to incur the tax, charged on plans with annual premiums exceeding $10,200 for individuals or $27,500 for a family.

Originally published on BenefitsPro. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Featured Video

Most Recent Videos

Prospects not listening to voice mail? Arrange a phone date


Redesigning your phone life is more important than finding the “best words” for a voice mail in today’s culture.

Behind the scenes with Vicki Gunvalson [VIDEO]


In this exclusive interview, Vicki Gunvalson shares how she built a $15 million a year annuity business by planning for...

Regulator: Market may need to reinvent LTCI


Cioppa says Maine's governor wants to spur the creation of better products.

Dementia: It's more than Alzheimer's


An association calls for policymakers to remember lesser-known neurodegenerative conditions.

Related resources

More Resources


Power your business with up-to-the-minute insurance news, analysis, and best practices from LifeHealthPro Daily eNewsletter – FREE.

Power your business with LifeHealthPro Daily eNewsletter – FREE.

Enter a valid email address.
Nichole Morford

Nichole Morford
Managing Editor

Thank you for subscribing to LifeHealthPro Daily!

Check Out More eNewsletters Now! Close

Advertisement. Closing in 15 seconds.