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
- The owner of the wholly owned corporation
- A more than 2 percent shareholder of an S Corporation or limited liability
- 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
x hours worked x 4/120 + full-time employees = FTE