Part-Time Workers Seeing Hours Cut in Advance of 2014 ACA

Employers, both large and small, are very nervous about a major feature of the Affordable Care Act (ACA) that kicks in January 1, 2014. Companies with 50 or more employees will be required to provide health insurance coverage for those who work at least 30 hours or face large fines.

Some companies are decreasing worker hours to avoid providing insurance for those employees. Not only will those workers not receive coverage through their employers, they will also have smaller paychecks. Nationwide, an estimated 2.3 million workers
are at risk, according to the UC Berkeley Center for Labor Research and Education. The trend of reducing hours is already being seen in large retail chains and restaurants. But even city governments and colleges are looking to reduce worker hours to decrease the cost of the coverage requirements.

Part-time employees who previously were covered by their employers will need to access the new state health insurance exchanges for new coverage. Some low- and middle-income workers may qualify for federal subsidies, and those with the lowest income may become eligible for Medicaid.

Small companies with less than 50 workers who currently provide coverage are facing rising premiums. Some are considering dropping coverage and increasing employee wages to assist their workers in obtaining affordable exchange coverage.