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The Affordable Care Act: What Government Contractors Should Do Now

January 11, 2013 Written by: Written by Adam Bonsky, EVP of Government Markets


Penalties for non-compliance with the Affordable Care Act become effective in less than a year.  Government contractors who are subject to the provisions of the law (those with 50 or more FTEs) should take action now to get into compliance.

First and foremost: If you’re not offering health insurance to your workers now, get covered.

• The longer you wait to find and implement coverage, the more difficult – and expensive – it’s likely to be.

• It takes time for a carrier to underwrite and rate a group. Take action now and prevent the possibility of missing the deadline.

• While changing more employees to part-time status may seem like a way to save money and hassle, is it really? This is likely to result in a less-skilled workforce, which will only cost you in the long run. Part-time employees may also be more likely to be less committed to doing excellent work, and may not be as loyal to your company.

• While you may have fewer than 50 FTEs now, what happens when you win your next contract? Will you even be able to win a contract that would require you to hire more workers if you can’t show proof of compliance with the law?

•If you’re not currently using the fringe portion of the prevailing wage to provide health insurance and other bona fide benefits for your workers, you’re already passing up significant savings on your payroll burden. That eats into your profits and makes your bids less competitive.  Paying fines for failing to comply with the law erodes your profit even further.

To find out more about using the fringe portion of the prevailing wage to save on payroll, submit more competitive bids, and provide health insurance for your workers, contact us.