Regarding the Affordable Care Act and household employees, including nannies, household employers may be wondering what, if anything, they need to do in order to comply with changes in health care laws. Below are some of the topics most likely to be relevant to household employers. Please note that rules and regulations are subject to change. A New England Nanny’s affiliate, GTM Payroll Services, will provide updates as they occur.
Household employers are NOT required to offer health insurance to their employee(s). Any employer with fewer than 50 full-time employees is not required to provide health insurance coverage to their staff.
Household employers MUST provide a Notice of Coverage Options. All employers must provide this notice to all current and any future employees. This will inform your employees about the coverage options that are available and the Health Insurance Marketplace. The Marketplace allows individuals to compare health insurance plans offered by private insurance companies. There are two sample notices that the Department of Labor provides, depending on whether you currently offer your employees health coverage or not.
Your employee is required to obtain health insurance coverage. While the law does not require you to provide coverage, your employee must be covered. Employees can purchase insurance through the Health Insurance Marketplace. To be eligible for health coverage through the Marketplace, your employee must live in the United States and be a U.S. citizen or national; if not a U.S. citizen, coverage can still be obtained, provided the requirements listed here are met. Plans and coverage will vary greatly from person to person; all of the information needed to get insurance can be found here.
If you wish to provide insurance to your employee(s), you most likely will not be able to use the Marketplace. As “sole proprietors” cannot obtain coverage for their employees through the Marketplace, most household employers are not eligible to purchase coverage for their employees. If an employer wishes to pay for coverage for their employee(s), a Health Insurance Reimbursement Arrangement may be the best option.
Household employees may qualify for a tax credit on their monthly premiums. Depending on 2015 income level and size of household, individuals may qualify for premium tax credits and other savings on a private insurance plan. Employees can apply part or all of this tax credit each month to their premium payments. The Marketplace will send the tax credit directly to their insurance company, so they pay less for premiums each month. Use this chart to help your employee see if they qualify.
For more information, please contact us at (518) 348-0400.