By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    physical health
    5 Ways Playing Games Can Improve Neural and Physical Health
    September 9, 2022
    Reasons For Hair Loss and Its Treatment
    Reasons For Hair Loss and Its Treatment
    February 16, 2022
    healthcare organization
    5 Actionable Strategies For Healthcare Organizations
    August 15, 2022
    Latest News
    7 Most Common Healthcare Accreditation Programs: Which Should You Use?
    August 20, 2025
    Hospital Pest Control and the Fight Against Superbugs
    August 20, 2025
    Hygiene Beyond The Clinic: Attention To Overlooked Non-Clinical Spaces
    August 13, 2025
    5 Steps to a Promising Career as a Healthcare Administrator
    August 3, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    4 Reasons Chris Cornell’s Death Raises Medical Ethics Questions
    December 19, 2018
    What If You Could Sell Your Vote?
    August 24, 2017
    The Sleepy American
    September 12, 2017
    Latest News
    How Social Security Disability Shapes Access to Care and Everyday Health
    August 22, 2025
    How a DUI Lawyer Can Help When Your Future Health Feels Uncertain
    August 22, 2025
    How One Fall Can Lead to a Long Road of Medical Complications
    August 22, 2025
    How IT and Marketing Teams Can Collaborate to Protect Patient Trust
    July 17, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Play or Pay: The Triple Aim for 2015 and Beyond
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Health Reform > Play or Pay: The Triple Aim for 2015 and Beyond
BusinessHealth ReformPolicy & Law

Play or Pay: The Triple Aim for 2015 and Beyond

Linda Ringquist
Linda Ringquist
Share
6 Min Read
Pay or Play
SHARE

Summary: What will you decide for your organization beginning 2015? Will you “play or pay”?

Contents
  • “Play” – “Play or Pay”
  • “Play” – “Play or Pay”
  • “Pay” – “Play or Pay”
  • How will the government know if you are not “playing” by the rules?
  • “Play or Pay” – Other Considerations

The “play or “pay” principle basically says that if employers with 50 or more full time employees don’t meet the minimum requirements of offering insurance coverage, they will pay very steep penalties. The provision will be phased in beginning in 2015. The “play or pay” principle is part of the PPACA, specifically under the provision of “shared responsibility”.

“Play” – “Play or Pay”

So, what are those minimum requirements?

Summary: What will you decide for your organization beginning 2015? Will you “play or pay”?

More Read

Medicare costs and the ACA
Medicare Cuts: Hospitals Don’t Make It Up on Volume
Not Poor Enough for Medicaid? Meet the ‘New’ Medicaid Doughnut-Hole
How to Curb the Cost of Cancer Care
Experience Life in a Better Way by Experimenting with Supplements!
Promising Malaria Vaccine

The “play or “pay” principle basically says that if employers with 50 or more full time employees don’t meet the minimum requirements of offering insurance coverage, they will pay very steep penalties. The provision will be phased in beginning in 2015. The “play or pay” principle is part of the PPACA, specifically under the provision of “shared responsibility”.

“Play” – “Play or Pay”

So, what are those minimum requirements?

Pay or Play

Coverage

A full time employee for the purposes of the “play or pay” principle is an employee who works at least 30 hours, regardless of status as determined by the employer. This extends to part time and PRN employees who meet this criteria. Additionally, the plan must contain the essential health benefits as set forth by the US Department of Health and Human Services. It is important to note that these essential health benefits may change from time to time and therefore must be monitored closely.

2015: Employers must offer coverage to at least 70% of their full-time employees and their dependents (up to age26), providing they have at least 100 full-time employees.

2016: Employers must offer coverage to at least 95% of their full-time employees and their dependents (up to age 26), providing they have at least 50 full-time employees.

Value

In terms of the Employer Mandate, a.k.a. “play or pay”, insurance plans must provide value. Value, in this context, refers to an employer not only offering coverage, but coverage through a plan in which at least 60% of covered services (including deductibles, copays, and coinsurance). While this seems like a fairly simple calculation, it can be quite complex. The HHS website provides a value calculator to assist you in meeting this requirement, https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/mv-calculator-methodology.pdf.

Affordability

The regulations are very clear on the affordability aspect of the “play or pay” principle. The threshold is 9.5% of an employees’ household income. The 9.5% can be calculated as a percentage of any of the following safe harbors:

PPACA

“Pay” – “Play or Pay”

We have talked about the “play” portion of “pay or play”. Now let’s focus on the “pay” aspect. Perhaps you are thinking that with all of this complexity, it may just be easier and cheaper to take the penalty and move on. Well, you may or may not know just how steep they can be:

Example: You have 1,000 employees

Scenario A: You don’t offer any coverage

  • Penalty: $2,000 *970 employees = 1,940,000
  • There is a slight discount in which the first 30 full time employees are exempt from the calculation
  • Do you have almost $2,000,000 that you can just throw away? Not many organizations do.

Scenario B: You provide coverage but it doesn’t meet either the affordability or value test.

  • Penalty: the lesser of:
  • $2,000 *970 employees = 1,940,000 or
  • $3,000 * the number of employees who purchase insurance on the exchange and are eligible for a subsidy, let’s assume 500. $3,000 * 500 = $1,500,000

How will the government know if you are not “playing” by the rules?

The trigger is going to be if any of your employees purchase insurance through the healthcare exchanges and are eligible for subsidies. One individual will trigger an audit of your organization in terms of coverage, value, and affordability.

“Play or Pay” – Other Considerations

There are other factors to consider when deciding whether to “play or pay”.

  • Can you quantify what you are currently spending to provide insurance to your employees?
  • Can you quantify the amount you are receiving as a tax deduction for providing insurance?
  • How will not providing insurance affect your employee’s taxes if they are no longer able to have premiums paid on a pre-tax basis?
  • Can you afford a mass exodus due to benefit cuts?
  • Are you easily able to calculate the 9.5% threshold for each employee?
  • Are you tracking all of the hours per employee including disability, paid time off, etc.?

Can you afford to “pay”? Can you afford these steep penalties? What are your thoughts on the employer mandate? What are your deciding factors when faced with the “play or pay” dilemma?

Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

travel nurse in north carolina
Balancing Speed and Scope: Choosing the Nursing Degree That Fits Your Goals
Nursing
September 1, 2025
intimacy
How to Keep Intimacy Comfortable as You Age
Relationship and Lifestyle Senior Care
September 1, 2025
engineer fitting prosthetic arm
How Social Security Disability Shapes Access to Care and Everyday Health
Health care
August 20, 2025
a woman explaining the document
How a DUI Lawyer Can Help When Your Future Health Feels Uncertain
Public Health
August 20, 2025

You Might also Like

The Fiction Behind The Cost of New Drugs

February 18, 2012
health IT HIMSS 2014
BusinessTechnology

Practical Advice for HIMSS 2014 Attendees

February 21, 2014
Be Prepared: Readying Your Facility For Alcohol-Related Treatment
Health careSpecialtiesWellness

Be Prepared: Readying Your Facility For Alcohol Related Treatment

October 16, 2017

How Healthcare Marketers Can Maximize Twitter’s New Features

February 17, 2015
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?