How Health Care Reform Affects Employer Plans

Medically Reviewed by Sarah Goodell on September 14, 2022

Many employees may have more choices for an affordable health plan as the result of the Affordable Care Act.


Why the Size of Your Company May Matter

If you work for an employer with 50 or fewer employees, your employer can offer you insurance through the Small Business Health Insurance Option Program (SHOP). This is an online Marketplace, similar to the one for individuals, where small employers can shop for insurance and offer health plans to their employees. Your small employer may also qualify for a tax credit if they pay a portion of the premium, which will make the insurance more affordable to you.

What to Do if Your Job's Insurance Is Too Costly

You do not have to enroll in the insurance offered at your place of work. Instead, you can buy insurance through your state’s health insurance Marketplace. However, if your company offers health insurance that is affordable and provides minimum coverage under the law’s requirements, you will not qualify for a tax credit. That’s the case even if your income would otherwise qualify you.

You can buy insurance through a Marketplace during the next open enrollment period. Check on for annual open enrollment dates.

How You'll Know About Your Choices at Work

Your workplace must tell you in writing about any changes to your insurance. According to the Affordable Care Act:

  • At least 30 days before any changes take place, your employer must give you a letter about your health coverage. The letter must give you information about your state’s Marketplace and tell you how to contact the Marketplace for help.
  • Your employer must tell you in writing if the plan doesn't meet minimum guidelines. The law says the insurance your workplace offers must, on average, pay for at least 60% of your covered health care costs. If it doesn't, you can buy insurance through your state's Marketplace where you may be eligible for financial aid from the government to help you pay part of your premiums, depending on your income.
  • The insurance your employer offers must be an affordable health plan. The law says it should not cost more than 9.61% of your family’s income. If it does, you may want to buy coverage through your state Marketplace. There, you may be able to get a tax credit to lower your monthly insurance costs. Or you may be eligible for Medicaid.
  • Your employer must tell you if a health plan offered is "grandfathered." If your employer still offers a health plan it offered on March 23, 2010, and has made few changes to the policy and how much you pay for it, that plan does not have to meet certain criteria of the Affordable Care Act. For instance, a grandfathered plan doesn't have to offer preventive care at no extra cost to you at the time of your visit.

Show Sources


Centers for Medicare & Medicaid Services: Center for Consumer Information & Insurance Oversight: "Minimum Value Calculator." 

Community Catalyst & Georgetown University Health Policy Institute: "Employer Requirements in the Affordable Care Act" and "How can Exchanges hold health plans more accountable?"

Congressional Budget Office: "Effects of the Affordable Care Act on Health Insurance Coverage-February 2013 Baseline."

Gallup Wellbeing: "Fewer Americans Getting Health Insurance From Employer." "About the Health Insurance Marketplace;" "Small Businesses and the Affordable Care Act;" "Large Business; and ''Important Marketplace deadlines: 2016 Open Enrollment.''

Kaiser Family Foundation: "Employer Responsibility Under the Affordable Care Act."

William Gallagher Associates: "Notification Requirements Put Forth by the Affordable Care Act." "If you have job-based insurance."

The New York Times: “Further Delays for Employers in Health Law.”

The Washington Post: “White House delays health insurance mandate for medium-sized employers until 2016.”

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