Employer healthcare contributions

[kelroy55]

I have a friend that says the contributions made by employers will be declared taxable income in 2016. I wasn't able to find this anywhere so I thought I would as if anyone here has heard that.

[jerrywall]

From what I understand, it's reportable (on the employer side) but not taxable.

Form W-2 Reporting of Employer-Sponsored Health Coverage

The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan. Reporting the cost of health care coverage on the Form W-2 does not mean that the coverage is taxable. The value of the employer’s excludable contribution to health coverage continues to be excludable from an employee's income, and it is not taxable. This reporting is for informational purposes only and will provide employees useful and comparable consumer information on the cost of their health care coverage.

[kelroy55]

Thanks... That's about all I could find so I'm not sure what they are talking about, unless they get health care as part of their retirement and that may be taxable.

[Chadanth]

I have a friend that says the contributions made by employers will be declared taxable income in 2016. I wasn't able to find this anywhere so I thought I would as if anyone here has heard that.

It's reportable because there's a cap on the deductibility, I.e., the Cadillac plan tax.

[kelroy55]

It's reportable because there's a cap on the deductibility, I.e., the Cadillac plan tax.

Is that tax paid by the employer or the employee, or both?

[Bullbear]

Not trying to derail .. but has anyone elses employer instituted the surcharge for carrying insurance on your spouse if the spouse has medical benefits offered at their own employer?.. its a first for my company and is making some waves. 75.00 surcharge bi-weekly.

[ctchandler]

It's reportable because there's a cap on the deductibility, I.e., the Cadillac plan tax.

Chandanth,
Here is a link to a CNBC report about the Cadillac plans. The headline reads "You're gonna pay for that-Obamacare's Cadillac Tax". I didn't read the complete article since I'm retired and it doesn't concern me.
C. T.

You're gonna pay for that-Obamacare's Cadillac Tax

[onthestrip]

Not trying to derail .. but has anyone elses employer instituted the surcharge for carrying insurance on your spouse if the spouse has medical benefits offered at their own employer?.. its a first for my company and is making some waves. 75.00 surcharge bi-weekly.

UPS made news last year about this when they dropped all of their employees spouses that worked for someone else that had their own health plan. Im not surprised companies are pushing spouses off their plan when they can get it eslewhere

[PennyQuilts]

Chandanth,
Here is a link to a CNBC report about the Cadillac plans. The headline reads "You're gonna pay for that-Obamacare's Cadillac Tax". I didn't read the complete article since I'm retired and it doesn't concern me.
C. T.

You're gonna pay for that-Obamacare's Cadillac Tax

It amounts to just another cost that will be trickled down to the employees.

[Chadanth]

It amounts to just another cost that will be trickled down to the employees.

I believe any plan valued in excess of the Cadillac cap is taxable to the employee.

[Bullbear]

our company didn't drop spouses only added the surcharge for carrying them if they have healthcare available at their employer. the principle is pretty simple that all employers should share the cost of healthcare. Spousal health care coverage cost us 42 million I believe was the figure last year. this helps offset that cost while encouraging people to take the coverage offered by their own employer. if the spouse doesn't have the option of healthcare or is unemployed then there is no surcharge.

[Motley]

I work for a Fortune 20 company and we have had this for the better part of a decade. If your spouse/partner works for a company that has a plan, there is a surcharge if that spouse/partner elects not to use it. Dependents can go on either parent's plan. If the spouse/partner does not have an alternative plan, there is no surcharge.

[TheTravellers]

More obvious consequences the right pointed out would happen and the left and low information voters either ignored or assumed it was prompted by racism or something.

I had this (surcharge for spouse that had insurance available to them elsewhere) in place at employers long before the ACA was even thought of, it's not something new that just happened because of the ACA.

[bombermwc]

Dropping a spouse is a major screw job to the employee because now you have two separate deductibles to meet in a year. Most plans charge a lot more for spouse coverage than children because of the higher use of the plan by adults. So the employee is already paying quite a bit more anyway. And if you're in a HSA plan, having two deductibles amounts to a MAJOR cut in pay regardless of whatever contributions your employer makes. I feel like HSA plans should be outlawed and some sort of capping should be placed on premiums. Insurance is just such a total crock of screw the employee these days. For some reason employers feel like they shouldn't have to absorb any of that cost...but last time I checked, it was a BENEFIT, which means yes, you need to absorb it because that's something you do to attract quality employees. I left my last job for many reasons, but one was the medical insurance plan, which was one of those screw you HSA plans.

[kelroy55]

Dropping a spouse is a major screw job to the employee because now you have two separate deductibles to meet in a year. Most plans charge a lot more for spouse coverage than children because of the higher use of the plan by adults. So the employee is already paying quite a bit more anyway. And if you're in a HSA plan, having two deductibles amounts to a MAJOR cut in pay regardless of whatever contributions your employer makes. I feel like HSA plans should be outlawed and some sort of capping should be placed on premiums. Insurance is just such a total crock of screw the employee these days. For some reason employers feel like they shouldn't have to absorb any of that cost...but last time I checked, it was a BENEFIT, which means yes, you need to absorb it because that's something you do to attract quality employees. I left my last job for many reasons, but one was the medical insurance plan, which was one of those screw you HSA plans.

I agree but what's cheaper, the deductible or the surcharge?

[Bullbear]

yes the "healthy living discount" we have for no tobacco use is a big difference in premiums than if you are not 100% tobacco free.
I am fine with the Surcharge. I would rather have it than to raise rates across the board due to the cost of covering spouses who have the opportunity to get coverage at their own employer. I have had the ability to cover my partner on my benefits for many years however he carrys his own benefits with his employer so we won't have any surcharge.

[kelroy55]

yes the "healthy living discount" we have for no tobacco use is a big difference in premiums than if you are not 100% tobacco free.
I am fine with the Surcharge. I would rather have it than to raise rates across the board due to the cost of covering spouses who have the opportunity to get coverage at their own employer. I have had the ability to cover my partner on my benefits for many years however he carrys his own benefits with his employer so we won't have any surcharge.

We get a nice discount for being tobacco free as well.

[Pete]

People are going to get perma-banned if they drag politics into topics outside the Politics Forum.

We are NOT going down that road, because I know exactly where it leads.

[bombermwc]

Well the payor mix at the employer makes a HUGE difference in the premiums, but it also has as much to do with the percentage the employer is willing to contribute to the plan. I believe it's federal law now that the employees are allowed access to (even if they have to pay for it) a report that shows the difference in premiums taken in and the amount paid out. We had such a bad mix at that job that it was almost a null difference, and we all felt like we were being screwed on a daily basis. The newer corporate leadership, however, continued to reduce the amount that they contributed to the plan and switched providers almost every year to try to avoid 15%+ premium increases as the insurance companies kept trying to make more off of us. It's really a lose lose for the employee in this world. THe over inflated prices have become so bad, that in order for insurance to be ABLE to pay, you have to put so much in, its' just a nightmare.

In my magic wonderland of pricing, I'd cap the max BILLABLE amount (and its gonna be half of what it is now for sure) on all procedures based on a zip code or regional average. I'd convert to single payor for sure and toss all these "insurance" companies and put a non-profit, non-govt group in charge of it. Step 2, make all health care non-profit and toss all for-profit hospitals/management groups/etc so the dollars go back into the employees and the patients and OUT of the hands of greedy shareholders. So the doctors can't afford a yacht anymore....I'm not crying about it when I see people in ERs because they can't afford any type of healthcare or elderly deciding if they should eat or take their pills.

It's totally not practical and would probably collapse the economy, but hey, so would world peace LOL. I didn't say it made sense, it's just a fantasy to make health care work right.....focusing on the patient and the employee...not the effing shareholder....which is the source of SOOOO many problems.

[kelroy55]

If you think about it employers offer health care as a perk to keep employees and anything they contribute is a bonus. When I was looking for a job I made sure to apply to companies that offered good benefits first. I'm sure a person could opt out of the health insurance plan and get it on their own.

[ctchandler]

If you think about it employers offer health care as a perk to keep employees and anything they contribute is a bonus. When I was looking for a job I made sure to apply to companies that offered good benefits first. I'm sure a person could opt out of the health insurance plan and get it on their own.

Kelroy,
At Hertz you couldn't "Opt out". Even if you were covered by your spouse, you had to take one thing. You couldn't opt out at Moore Schools either. Since Hertz had the better options than Moore Schools, Dianna, a school nurse at Moore was covered by my insurance but she had to take one option. She selected a disability option. I don't know how common this is, but it's the two I'm familiar with.
C. T.

[kelroy55]

Kelroy,
At Hertz you couldn't "Opt out". Even if you were covered by your spouse, you had to take one thing. You couldn't opt out at Moore Schools either. Since Hertz had the better options than Moore Schools, Dianna, a school nurse at Moore was covered by my insurance but she had to take one option. She selected a disability option. I don't know how common this is, but it's the two I'm familiar with.
C. T.

Thanks CT .... I wasn't aware you couldn't pass on the company health insurance plan. I believe that option was available at most if not all the places I've worked.

[ctchandler]

Thanks CT .... I wasn't aware you couldn't pass on the company health insurance plan. I believe that option was available at most if not all the places I've worked.

Kelroy,
Things change, I retired ten years ago, so I have no idea what the rules are now.
C. R.