Why Obamacare affects German companies, too
12.10.2016 - Since 1 October 2013, 16 million Americans have had medical insurance for the first time, thanks to the Patient Protection and Affordable Care Act – more commonly known as Obamacare. The basic concept behind this healthcare reform is that every American should have access to good-quality, affordable medical care. The law’s influence reaches beyond American borders, however – all the way to Germany. Funk gives four reasons why Obamacare also affects companies round here:
1. Obamacare holds companies responsible
For companies which have at least 50 full-time employees, the employer must provide adequate insurance cover for its full-time employees (this is known as the ‘employer mandate’). Otherwise the employer may face fines. The head of the Key Account Division at Funk explains: ‘Many US companies are seizing on the opportunity to position themselves as an attractive employer at the same time, by offering a comprehensive healthcare programme.’
2. Obamacare can be applied to employees on business trips to the USA
Every person who pays taxes in the United States and therefore works in the USA over a longer period of time must have insurance cover. Since this year, the law not only applies to US citizens but also to employees who are sent to the USA by their employer (‘expats’), with retroactive effect from 1 January 2015. Short business trips are excluded from Obamacare. The ‘Substantial Presence Test’ serves as a guideline for determining whether an employer must provide medical cover for its employees based on the length of their stay in the country.
3. Obamacare has changed the basis for foreign insurance cover in the USA
Expats may have medical insurance from an insurer outside of the USA. ‘In practice, this is often the case,’ says Frank Rebenstorff, Senior Consultant and expatriate expert at Funk Vorsorgebera-tung GmbH. ‘Many companies have arranged for their overseas medical insurance through insur-ers round here and are happy with the service they receive. But with the introduction of Obamac-are, the basis for sufficient insurance cover in the USA has changed. Here at Funk, we always check every individual case to determine whether current cover complies with Obamacare.’ If cur-rent cover does not comply with the law, it may be a good idea to implement an international health insurance solution with a provider that meets local regulations.
4. Obamacare depends on political developments
The Obamacare chapter is still being written. Political developments and changes to the law may lead to further changes in American healthcare reform – which may also affect Germany compa-nies which are active in the USA. ‘What’s important is to continually check insurance cover and adapt it where necessary,’ advises Rebenstorff.
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