Following the U.S. Supreme Court’s June 25 ruling to uphold the Affordable Care Act, employers should know that the law, otherwise known as Obamacare, is here to stay in its present form.
“The upshot is the Affordable Care Act will continue to be enforced, low-income individuals will continue to get subsidies, employers are still subject to the pay-or-play mandate, and the rules that are part of what Congress drafted, and the rules and regulations the federal agencies came up with to enforce it will still be in effect and will be enforced,” said Charlie Stevens, an employment attorney at Milwaukee-based Michael Best & Friedrich LLP.
Stevens added that large employers will still be required to offer coverage to employees who average 30 or more hours per week. If they do not offer coverage to 70 percent of full-time employees, they will be subject to the pay-or-play penalty. Next year, he said the percentage of full-time employees who must be offered coverage will be 95 percent.
While the law as a whole continues to apply, Stevens said remaining concerns that Congress may take up in the future include the definition of full-time employee and the “Cadillac tax.”
“With regard to the definition of full-time employee, there’s been a trend with some employers that when in doubt hire part-time, especially in the current economy, so fewer full-time employees have been hired,” Stevens said. “There’s been some discussion as to how to modify ‘full-time employees’ to encourage more full-time hiring.”
The Supreme Court’s decision was considered by many to have boiled down to four key words in the Affordable Care Act: “established by the state.” The plaintiffs in King v. Burwell claimed those words meant that tax subsidies were intended only for those in state-run exchanges. The Obama administration said “the state” refers to the government in general, whether state or federal.
Wisconsin is one of 34 states that is using the federally-run exchange, as opposed to creating a state-run exchange. If the Supreme Court had ruled against the Obama administration, 184,000 people in Wisconsin and 6 million people nationwide could have lost their health insurance.
