Donkeys vs. Elephants: What ACA Means for Humans

health-care-reformSince it was passed into law in 2010, the Affordable Care Act (ACA) has been a constant source of political debate. There is one thing that everyone agrees on: implementation of the ACA is a complicated process with hard-to-predict consequences.

The landmark healthcare reform bill will be a mixed bag with both positive and negative consequences.

First the bad news. Under the ACA, all companies—including staffing firms—with at least 100 full-time employees (defined as workers who work at least 30 hours a week), will be required to provide health insurance to their employees starting on January 1, 2015. For companies with 50 to 99 employees, the requirement has been pushed back until January 1, 2016. Companies that don’t comply with the requirement face a $2,000 penalty per employee.

Staffing firms will either list health insurance as an invoice line item; or simply increase their bill rates to account for the new overhead expense. Messina Group will show the fee as a line item on invoices.

Now for the good news. Now that improved benefits will be available through staffing firms, more and more talented professionals with in-demand skill sets will choose to make a career out of the temporary model.

Since higher-level talent will be available, and the cost of adding full-time employees will increase, companies smaller than the 50-employee threshold will benefit from using agencies while they grow. In essence staffing firms allow companies to ramp up without crossing the 50-employee threshold and triggering the health insurance requirement.

It will certainly be interesting to see how the labor market and hiring trends react when the ACA’s employer-provided health insurance requirement goes into effect on January 1.

If you have any questions about how the ACA will affect the talented professionals provided through the Messina Group, we are happy to provide you additional details.

 

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Michael Parks

Michael Parks

Michael Parks is the client-facing CEO of Messina Group where he advises organizations in the areas of Business Transformation and Sales Enablement. Michael was founder and CEO of The Revere Group, growing the firm to more than 500 business and technology consultants and was named “Entrepreneur of the Year” by Ernst & Young.

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