On Oct. 1 this year, the federal health care exchange will open for enrollment.
Before then, it’s important for restaurateurs — even those with small companies — to get a firm understanding of the Patient Protection and Affordable Care Act and what it requires, said Michelle Neblett, director of labor and workforce policy, during a session at the National Restaurant Association.
“A lot of folks are in that information-gathering stage and are looking at [their] options before they make a final business decision,” she said, adding that a lot of operators, if not most of them, have yet to decide on the best course of action for their company.
The complex law, which passed in March 2010, has many restaurant operators concerned — evidenced by full sessions about the mandate at the 2013 National Restaurant Association show. Steep noncompliance penalties, as well as employee relations, are both major concerns when considering how to implement health care.
Before deciding what plan of attack to take when approaching the health care mandate, operators must determine some basic facts about their restaurant company and take some small actions to prepare for the task of complying with the law, Neblett said.
“Be ready,” said Randy Spicer, who works in health care services at the National Restaurant Association. “Most of you are well down the path to deciding what you will do and what you will offer…there will be a lot of noise in the marketplace about the exchanges being open for business.”
Neblett and Spicer outlined some key steps operators can take to prepare:
Determine company type
Under the healthcare law, employers with 50 full-time equivalent employees or fewer do not have to offer their employees minimum essential health care coverage, Neblett said. Employers who have more than 50 employees must offer health care coverage to all full-time employees. A full-time employee is defined as people who work at least 30 hours per week, or 130 hours in any month.
The calculation to find out what type of employer you are is quite simple, she said. Written as an equation, it looks like this:
Full-time employees + total hours worked/ 120 = full-time-equivalent employees
If the answer comes out to more than 50, your business is required to offer coverage, she said.
The law does not require employers to offer part-time employees health care coverage, which is important to note, Neblett said. Per the health care mandate, part-time employees are those working 120 hours or less each month.
“It is absolutely a strategy” to ensure that part-time employees don’t work too many hours to make them full-time, she said. Accurate employee measurement at the company level, she noted, is key to implementing the law.
Communicate with employees
By Oct. 1, all employers are required to give their employees information about how to sign up for health care on the federal exchange.
“It’s going to be a decision point for a lot of your employees,” Neblett said. “An offer of coverage is that you give your employees the opportunity to accept or decline an offer. It is up to the employee — not the employer — to either take coverage through his or her employer or go to the federal exchange to purchase health care coverage.
Under the law, individuals are required to have minimum essential health care coverage, said the NRA’s Spicer. That’s why employers are required to keep them abreast of their coverage options.
As long as the correct offer is made and documented, the employer is generally covered from penalties related to noncompliance. “This employer notice is very important,” he said. “Do the smart thing, and get your notice out to people and then document the fact that you provided notice to everyone.”
Hire help as necessary
Along with the steps above, there are a slew of reporting and implementation requirements for the law put into place by the government, Neblett said.
For these more complicated measures, it may be necessary to hire an attorney or accountant to help make sense of the law, and to avoid penalties or overpaying.