The Supreme Court recently upheld President Obama’s healthcare law, so you now you are probably wondering how it will affect your small business.   The Affordable Care Act provides a variety of programs  to help small business provide health insurance for their employees.  Below is an overview of some of these programs.   

Small Business Tax Credit

Many small business may qualify for tax credits under the Affordable Care Act.  To qualify as an “eligible small employer” you  must:  have more than 25 full-time equivalent employees (FTE); average annual wages of your employees must not exceed $50,000; and the employer must make an arrangement in which it “[contributes] on behalf of each employee who enrolls in a qualified health plan offered to employees by the employer through an exchange in an amount equal to a uniform percentage (not less than 50 percent) of the premium cost of the qualified health plan.”  26 U.S.C. 45R.  If you qualify, your small business may receive a tax credit of up to 35% or 24% for small non-profits.  Id.  In plain English, if you employ more than 25 individuals in your small business, who earn on average less than $50,000, you may qualify for a tax credit of up to 35%. 

Early Retiree Reinsurance Program

The Early Retiree Reinsurance Program provides financial relief to employers so retirees can receive quality health insurance.  The program will “provide reimbursement to participating employment-based plans for a portion of the cost of providing health insurance coverage to early retirees (and to the eligible spouses, surviving spouses, and dependents of such retirees)….” 42 U.S.C. 18002.  In other words,  employer based plans which cover retirees aged 55-64, can now get financial help through the Early Retiree Reinsurance Program.

Affordable Insurance Exchange

Starting in 2014, small businesses with fewer than 100 employees will be eligible to shop for insurance at an Affordable Insurance Exchange.  These “exchanges” are “designed to assist qualified employers in the State who are small employers in facilitating the enrollment of their employees in qualified health plans offered in the small group market in the State.”  42 U.S.C 18031.  Put simply, small businesses will have the opportunity to shop for health insurance at health insurance exchanges which give small businesses similar health insurance choices as large business in health insurance purchasing.