Target Corporation ACA Planning
As companies around the country conduct their own impact analysis and model various scenarios, we see them continuing to define and outline their Affordable Care Act strategy and announce aspects of their plan. Target has become the most recent addition to the list but certainly not the last.
Target Corporation recently announced that part of their strategy will be to no longer be offer healthcare coverage to their Non Full-Time employees. They will however be giving Non Full-Timers an additional $500 a year to help cover the cost of coverage, and will be providing counseling services to help the employees with this new transition. Target cited the Affordable Care Act for the reason they made this decision. This is likely going to be a trend that we see as we slowly approach 2015 when the Employer-Shared Responsibility Tax takes effect. Under the complex regulation, employers must only offer coverage to their Full-Time employees (employees working 30 or more hours a week on average). There is no penalty if an employer simply does not offer coverage to their Non-Full-Time employees, which makes this strategy an attractive cost controlling one for employers.
We continue to hear about the creative strategies that employers are developing in response to the ACA. Large organizations such as Target have the resources internally to address these issues and develop these solutions. Others companies will be looking for the professionals to guide them through this process. No matter the size of the employer, the ACA and its impact is important to understand. Every company needs a plan. So expect that 2014 will be a challenging and complex year for many companies. Early planning and preparation is vital to success so more companies need to follow Targets lead by developing their strategy and putting their plan in place now.