By Peggy Jo Goodfellow, Arizona Farm Bureau: On October 20, 2014, AZFB published an article entitled “Affordable Care Act: Questions for a Health Insurance Specialist”. Since the publication of that article, there has been additional guidance issued by the federal government regarding one portion of that article. Specifically, on November 6, in an FAQ document jointly issued by the Departments of Labor(DOL), Health and Human Services (HHS) and the Treasury, the three departments provided additional detail around how an employer can provide health benefits to their employees.
In the article, we stated employers could provide an after-tax allowance to employees to purchase individual health coverage. The new guidance issued on November 6 now states that employers cannot provide either before tax or after tax dollars to employees to purchase individual insurance policies. If the employer wants to provide coverage to their employees, they must provide it through a group health plan. As with any large piece of legislation, there are often changes to the administration of the law as time goes by and this is one of those occasions. We will continue to keep you informed of any changes in the law as we become aware of them. We strongly encourage our employer members to work with their accountant in any issues related to tax deductibility or employer benefits.