A Health Care Law Guide for Employees

October 9, 2012

The Patient Protection and Affordable Care Act (PPACA) creates many new requirements that can be overwhelming to employees as they try to understand how the law will affect them. Some provisions help employees and others will impose more taxes and make obtaining insurance a headache, says the National Federation of Independent Business.

Despite all the seemingly employee-friendly provisions in the law, there are many provisions that hurt employees.

  • Americans must have insurance or face a tax.
  • If an employee gets insurance through his or her small business or on their own, they'll have to pay a Health Insurance Tax of around $500 in increased premiums annually.
  • Drug companies will be forced pay new taxes on brand-name drugs and medical device companies will pay a 2.3 percent tax on their products, which will be reflected in higher premiums.
  • An employee with a Flexible Spending Account or a Health Savings Account can no longer use pretax dollars to buy over-the-counter medications and other health care items.
  • Furthermore, the PPACA places a $2,500 cap on the amount of pretax dollars you can spend on health expenditures.

In addition, employees will lose choices in coverage, which hurts the individual as well as the entire health care industry.

  • Employers with 50 or more full-time employees will have heavy penalties if any full-time employee receives subsidies. This encourages businesses to downsize.
  • Furthermore, the upshot in demand for health care and paid services will mean fewer doctors, which will increase wait times and costs for seeing a physician.
  • Additionally, the Congressional Budget Office says the PPACA reduces Medicare payments by $700 billion and creates an advisory board with the power to determine which procedures Medicare pays for.
  • As a result, many seniors will lose access to Medicare Advantage or otherwise be forced to pay more for access to other private insurance plans through Medicare Advantage.

Source: "PPACA: A Healthcare Law Guide for Employees," National Federation of Independent Business, September 28, 2012.

 

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