Why size matters

Health insurance laws apply differently to small and large employers, so it is important to know the size of your employer.

  • Small employers with fewer than 50 employees do not have to cover employees or their dependents.
  • Large employers with at least 50 full-time equivalent employees face a tax penalty, starting in 2015, if any full-time employee receives financial help to buy health insurance through an exchange such as Cover Oregon.
  • Employers with more than 200 employees who offer at least one health plan must automatically enroll new full-time employees in one of the plans offered, though employees may opt out. The effective date for this requirement has not been set.
  • Employers with fewer than 25 full-time equivalent employees may be eligible for tax credits to offset up to 50 percent of their premium costs.
  • Self-employed people with no employees can buy an individual health plan through Cover Oregon and may qualify for a subsidy to help with costs.

How do I know if I’m a small employer?

Under Oregon law, a small business is defined as having 50 or fewer full-time equivalent employees (FTE). A full-time employee, under the Employer Responsibility section of the federal Affordable Care Act, works 30 hours or more per week.

These people do not count as employees:

  • Sole proprietors
  • Partners
  • The owner of the wholly owned corporation
  • A more than 2 percent shareholder of an S Corporation or limited liability company
  • The spouse of any person listed above

To determine if you have 50 or more FTE:

  • Count the number of your full-time employees
  • Add up the number of your part-time employees
    • Multiply the number of part-time employees by the total hours worked by all part-time employees.
    • Multiply that number by four (weeks) and divide by 120.
  • Add in the number of full time employees to get your FTE


Part-time x hours worked x 4/120 + full-time employees = FTE



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Key links

IRS information for employers

Large employers