Experts Review ACA Small Business Provisions

At a recent ADP webinar entitled What Small Businesses Need to Know About the ACA, health reform expert Liz Mazza, senior counsel for ADP’s Small Business Services, reviewed the Patient Protection and Affordable Care Act’s (ACA) provisions that impact small businesses. Mazza noted that the ACA “is designed to help small employers by lowering premium cost growth, and increasing access to quality, affordable health insurance.” The topics addressed at the webinar included the small business health care tax credit (HCTC) and the Small Business Health Options Program (SHOP) Marketplace, among others.

HCTC. Under the ACA, eligible small employers have been able claim the small employer HCTC since 2009 if it makes nonelective contributions that pay for at least one-half of the cost of health insurance premiums for the coverage of its participating employees. According to Mazza, “the tax credit was designed to encourage small employers to offer and maintain group health insurance.”

Small employers should be aware that to qualify for the credit, they must have fewer than 25 employees and the average employee salary for the tax year must be less than $50,000 per full-time employee. In addition, to qualify for the tax credit in 2014 and later years, small employers must “must purchase coverage through the SHOP Marketplace and obtain an official eligibility determination from the SHOP Marketplace,” said Mazza.

SHOP Marketplace. The SHOP Marketplace has been available for small employers since January 2014. To purchase coverage in the SHOP, small employers must meet certain criteria, noted Mazza. Small employers must have 50 or fewer employees; must have an office or employee worksite within the SHOP state; and must offer coverage to all full-time employees. “The SHOP marketplace allows you to enroll in and manage coverage. You can control the coverage you offer and how much you pay toward employee premiums. Some of the benefits of the SHOP are greater purchasing power, the ability to pool risk, and more choices among health plans,” said Mazza.

Starting November 15, 2014, small employers must apply for and enroll in SHOP coverage online. Paper applications are no longer available. In addition, “if you had SHOP coverage for 2014, you will not be able to renew your coverage directly with the insurer. You will have to enroll online through the SHOP marketplace at,” said Mazza.

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