A major component of the Affordable Care Act is guaranteed preventive care services at no cost to any person with healthcare insurance. At first glance it would appear that free preventive care would include annual wellness exams from the subscriber’s primary care physician along with other yearly checkups at no cost to the subscriber. However further review of this mandate makes it clear that it has a much broader intention.
Before I hire a new employee, I usually give that person a written summary of the specifics we have discussed during the interview. I include such things as pay, starting date and benefits. Now I wonder, am I creating a contract by putting a job offer in writing?
Depending on the content of your communication, it’s possible you may be creating an employment contract or documenting elements of an employment contract.
Keep this in mind: Every new employee who begins a new job has a contract of employment. Usually the terms of this contract are made up of overt and implied oral promises which a supervisor or manager has made to the employee, statements in the application form and in the employee handbook, and commonly accepted practices in the workplace. So anything about conditions of employment that someone in authority in a workplace puts in writing and gives to an employee can create terms of an employment contract.
Historically, employers that wanted their employees to be protected with health coverage, but didn’t want the hassle of having a company health plan, could simply give them an amount of money sufficient to reimburse them for the cost of buying that coverage or some portion of it. As long as the individuals provided evidence that they used those funds for that purpose, the dollars were excludable from taxable income for the employees.
Alternatively, employers could just pay the premiums directly to the insurance carrier.
Back in November 2014, however, the Department of Labor (DOL) declared that companies reimbursing employees for medical care instead of offering a health care plan is equivalent to a health plan and is subject to the Affordable Care Act (ACA). And since those reimbursement arrangements failed to meet ACA requirements in two ways — that is, the condition that group health plans have no annual limits on benefits, and also that no co-pay for certain preventive health services must be paid — they were ruled to be noncompliant with the law.
Laws on this topic vary from state to state.