2013 is the last year small-business owners have to prepare for the health care reform law, which requires certain businesses to provide health insurance to their employees. Beginning in 2014, companies with 50 or more full-time employees must provide adequate health insurance. Failure to do so will result in a $2,000 per worker penalty. Providing coverage that is deemed inadequate will generate a $3,000 per worker penalty. The challenge is determining how much plans considered adequate by law will actually cost. There are also complex provisions that provide additional exemptions and allow some plans to be grandfathered. Pending litigation on the technical legal issues could also affect the final requirements. While some companies have indicated they will adjust their headcount to avoid the 50 FTE threshold, others have indicated they may simply pay the fine if the adequate plans are unaffordable.
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