HCR and Impact on PEOs.

[Quotebroker]

A question off the top of my head for those more current on HCR than I: When 2014 comes along, will PEOs be faced with the same penalty as traditional "large group employers" if they do not provide healthcare coverage to their employees? Is there an exemption* for these types of organizations? Is there something I am missing in their structure that would not trigger this large group penalty?


*are there more rules or exemptions at this point?

 

[JosephDeacon]

Interesting question. I do not know. Hopefully someone will come along who will know the answer.

 

[ABC]

They will fall under the same laws as everyone else.

They will have the $2,000 penalty per head if they are not offering benefits. I think it will change their entire business model unless they can find a loop hole.

Staffing companies are also going to have a hard time avoiding the penalty. I have met with a couple of them and I think you will see a shell game of corporations. If the staffing companies are forced to insured these employees there is no way they can stay competitive.

 

[stuy119]

They will fall under the same laws as everyone else.

They will have the $2,000 penalty per head if they are not offering benefits. I think it will change their entire business model unless they can find a loop hole.

Staffing companies are also going to have a hard time avoiding the penalty. I have met with a couple of them and I think you will see a shell game of corporations. If the staffing companies are forced to insured these employees there is no way they can stay competitive.

Won't the shell corps fall into a controlled group situation according to the IRS, thus making them eligible again to provide benefits?

 

[ABC]

Won't the shell corps fall into a controlled group situation according to the IRS, thus making them eligible again to provide benefits?

Yes, but people will find loop holes. It will take time for the IRA to close those loop holes.

 

[Quotebroker]

They will fall under the same laws as everyone else.

They will have the $2,000 penalty per head if they are not offering benefits. I think it will change their entire business model unless they can find a loop hole.

Staffing companies are also going to have a hard time avoiding the penalty. I have met with a couple of them and I think you will see a shell game of corporations. If the staffing companies are forced to insured these employees there is no way they can stay competitive.

It seems contradictory that the Congressional record reflects that the eligibility for the small group tax credit for PEO members would be based on their size/structure if they didn't exist inside the PEO, but that the PEO at the top level would be forced to provide benefits across the entire spectrum of their membership. You'd think they'd decide one way or the other, but that's just another example of the inconsistencies in this legislation.