Your Brewery & The PPACA
Question – What is the preferred beer to drink while “digesting” 2,000 plus pages of the Patient Protection and Affordable Care Act (PPACA)?
Answer – I’d recommend Founders’ All Day IPA, Brewery Vivant’s Solitude, and Saugatuck’s Bonfire Brown. This way you’ll have something to drink all day while you commune in solitude and then something to burn the midnight oil with.
Alternative – You could just read the following, and if you need help, give the BPA a call.
If your brewery is of a size to be considered a “large employer”, you have some calculations to do that will rival the scheduling of your brew kettle, fermentors and bright tanks.
A large employer is a company that has 50 or more full-time and full-time equivalent employees. This means you not only have to count the number of full-time employees in your company, but you also need to calculate the full-time equivalents. Note, there is a new 30-hour rule with regards to full-time employees, which states a full-time employee is an individual who works 30 or more hours per week.
In order to determine the full-time equivalents, you will need to calculate the total number of hours worked by all part-time individuals (i.e. those working less than 30 hours per week) for the month, and then divide by 120. You will then add this to the number of full-time employees to determine whether you are at or above 50 full-time and full-time equivalents.
Please note that while you need to figure out the full-time equivalents for the purpose of the large employer calculation, you do not have to offer insurance to those employees. The only requirement is to offer the insurance to employees who are considered full-time according to the new rule.
The large employer mandate provision takes effect in 2014. Companies with a large number of current part-time employees who work between 30-35 hours per week, may want to consider taking steps to reduce the number of individuals who are considered full-time under the new law.
The government did implement safe harbor provisions to help determine (and possibly delay) when an individual needs to be offered insurance under the 30 hour per week rule.
How about if we are not a large employer, but provide health insurance benefits to our employees?
Two things you should know...
Your brewery may be eligible for a tax credit if you employ fewer than 25 full-time equivalent employees during the tax year and pay average annual wages under $50,000.
Beginning in 2014, non-grandfathered health insurance plans must follow the same non-discrimination testing rules that apply to health insurance plans as outlined under IRS Section 105(h)
In the fall of 2013, all employers are required to inform their employees of the state and federal health insurance exchanges available to them!
One benefit of the exchanges is that small breweries may have access to better health care plans, instead of being limited in what they can offer to employees. The goal of the exchange is to offer acceptable coverage at a reasonable price.
As an employer, you may be able to purchase insurance through the exchange for your employees, if you meet the following conditions:
Have at least 1 employee at the beginning of the plan year
Have an average of at least 1 employee during the entire year
No more than 100 employees on any business day during the plan year
States also have the right to lower the requirement to employers with fewer than 50 employees. At this time, it is not known how the exchange system will work in the State of Michigan. The state and the federal government should issue further guidance in the upcoming months. Check brewerybiz.com often for updates.
To learn more about the PPACA, contact Travis Sinquefield at 616.735.3088.