PPACA Blog

Aug 30, 2010

Information on "no discrimination based on compensation" regulation (PPACA)


Category:PPACA 
Posted by: Neal

The health care reform law notes that, effective September 23, 2010, plans may not discriminate in favor of highly compensated employees. This means that group health plans cannot base eligibility or the level of benefits on an employee's wage. The group can offer different levels of benefits as long as they comply with ERISA and are not tied to the amount an employee makes. The legislation defines a highly compensated employee is someone who is:

  • One of the five highest paid officers.
  • A shareholder who owns more than 10% in value of the employer's stock.
  • Among the highest paid 25% of all employees (exceptions apply).

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