Total Rewards | Risk Management
Employers that offer health benefits to their employees may also offer wellness programs to contain health plan costs, help employees stay healthy and increase employees’ knowledge as health care consumers. Wellness programs also referred to as: disease-management programs, employee wellness plans or programs, corporate wellness programs, or a range of other names, take many forms.
Q: Does an employer’s cash-out option (i.e., cash-in-lieu of benefits) have any impact on the coverage’s affordability under the employer mandate? A: Yes. As background, under the employer mandate, the employer must offer at least one affordable, minimum value plan to all full-time employees, or risk a penalty. Affordability is based on the cost to the full-time employee for single-only coverage. Generally speaking, coverage is affordable if the cost of single-only coverage does not exceed 9.5 percent of that employee’s W2 wages or 9.5 percent of that employee’s rate-of-pay. (There is also a way to determine affordability based on the federal poverty line.)
