Avoiding the Employer Medical Assistance Contribution Supplement (EMAC)
Have you seen your payroll taxes increase this year in MA? Have you noticed that it's not for all of your employees, just some? That's because this is our first year of the EMAC law supplement. You can see additional exposure of up to $750 dollars per employee depending on where they are finding their health coverage.
The Employer Medical Assistance Supplement
The Employer Medical Assistance Contribution Supplement applies to employers with more than five employees in Massachusetts, whose non-disabled employees obtain health insurance either from MassHealth (excluding employees with MassHealth coverage as a secondary payer)1 or subsidized coverage through the Massachusetts ConnectorCare program. The non-disabled employee must be enrolled in Mass Health (excluding employees with MassHealth coverage as a secondary payer) or subsidized coverage through the Massachusetts ConnectorCare program for more than eight weeks during the quarter. The contribution is 5% of annual wages for each non-disabled employee, up to the annual wage cap of $15,000, for a maximum of $750 per affected employee per year. The contribution does not apply to employees who earn less than $500 in wages per quarter. The contributions collected will help offset the Commonwealth’s cost of providing health insurance to your employees. This supplemental contribution only applies to those employees on state-subsidized coverage.
How do you avoid the increase?
Simply put, you need to offer coverage that can compete with this exchange when it comes to price. The Bronze level plans on the exchange may not cover much, but they're dirt cheap. For a lot of employees the number one concern when talking about health insurance is how much money comes out of their paycheck. It can be hard for employers to offer these bottom level plans in their benefits package simply because most carriers put a restriction on how many plans you can offer. If you only have the ability to offer two plans, it can be hard to justify using one of those options on a bottom dollar solution like a Bronze plan.
The solution?
Using providers that allow you to increase the amount of plans you can offer. For example, #PEO providers typically allow you to broaden the scope of coverage you offer because they have pooled their employee groups and have greater buying power. #TriNet clients in MA have 14 plans to choose from, and those plans range from your Bronze level to top of the line "Cadillac" plans wth zero deductible. Another advantage to this type of group is that because their buying power is so great, it will insulate you from massive year-over-year premium increases.
Phone a friend
Lets talk more. I'm a resource that you can use whether you're a client or not.
Your Friendly Neighborhood Employee Specialist,
Jake
617-593-2629