• Health Reform Mandates: House/Employer

    Having already written about the Senate health reform bill’s employer and individual mandates and subsidies, I now turn to the House bill, which is mercifully simpler (all posts on health reform mandates are found under the “health insurance mandates” tag). This post is on the House employer mandate, and my sources are the Kaiser Family Foundation’s summary of the House bill and two Health Affairs blog posts by Timothy Jost.

    The House bill includes a standard “pay-or-play” provision. It would require employers to offer insurance meeting a minimum standard and to pay at least 72.5% (65%) of the premium for single (family) coverage (the “play” part). Employers failing to do so would be required to pay 8% of payroll into the Health Insurance Exchange Trust Fund (the “pay” part). This penalty is reduced in steps for businesses with payrolls below $750,000.

    Employers with fewer than 25 employees and average wages below $40,000 would be eligible for a health coverage tax credit for up to two years. The credit is at most 50% of premium costs paid by employers (for employers with fewer than 11 employees and average annual wages below $20,000). The credit phases out as firm size and average wage increases. Credit cannot be obtained for employees earning more than $80,000 per year.

    Finally, a temporary reinsurance program would be created for employers providing health insurance coverage to retirees over age 55 and not eligible for Medicare.

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