Businesses might look to temporary-staffing agencies to avoid ACA health coverage requirements

Some businesses might begin hiring more workers through temporary-staffing agencies to avoid providing health insurance under the Affordable Care Act, the Washington Post reports.

Under the ACA, businesses with at least 50 workers beginning in 2014 must pay a penalty of $2,000 per employee if they do not provide affordable coverage to their employees. Employers will not be required to pay for the first 30 workers who are included in the penalty calculation.

However, the law requires that businesses offer coverage only to those employees who work more than 30 hours per week. In addition, an IRS rule allows businesses to avoid providing health coverage to “variable-hour” workers if it is unclear whether such employees will be full time. Employers have a year to determine whether the workers qualify for health benefits but many temporary staffers do not remain with the same company for a full year. As a result, businesses could have an incentive to hire more temporary, part-time employees.

Temporary staffers still can purchase coverage through the ACA’s insurance exchanges and many likely will qualify for subsidies to help them purchase coverage. In addition, some will qualify for Medicaid.

2013-03-27T00:00:00+00:00 March 27th, 2013|Advocacy|