Zane Benefits Publishes New Information on Employer's ACA Play or Pay Decision

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Businesses with 50+ Employees Face Three Decisions for Health Benefits in 2014.

Today, Zane Benefits, Inc. published new information on the ACA play or pay decision. Zane Benefits, which provides comprehensive and flexible alternatives to traditional employer sponsored health benefits, is the leader in defined contribution health plans and health reimbursement arrangement plans.

According to Zane Benefits’ website, employers with over 50 employees are still uncertain about how the Affordable Care Act's "employer mandate" impacts them. The employer mandate requires applicable large employers to either offer health insurance, or else pay a tax penalty.

Play or pay is a concept that requires employers with over 50 FTE employees to provide health insurance to their employees ("play") or pay a tax or premium toward a publicly provided system that covers people without private insurance ("pay"). The ACA play or pay requirement is also referred to as the "employer mandate" or "employer shared responsibility."

The Play or Pay Decision ... and how to Play Differently

According to Zane Benefits’ website, many employers are asking “should we play, pay, or play differently with a defined contribution plan?” The decision is not always easy or straightforward. Ultimately, employers want to provide a health benefit that is valuable to employees (i.e. recruitment and retention), and has value to the employer (i.e. the best benefit for the cost). The three choices an employer for employers with over 50 employers are to play, pay or play differently with defined contribution.

1. To play means a company would offer employees health insurance that meets essential health benefits and is affordable to employees, by ACA standards.

2. To pay means a company would choose to not offer health insurance and instead pay a tax penalty.

3. To play differently is the middle ground between play and pay. It means a company chooses not to offer a group health insurance plan, pays any applicable penalties, and instead offers employees a health benefits allowance (called “Pure Defined Contribution”). Employees purchase policies from an insurance agent, online, or through the new health insurance marketplaces. Then, a company reimburses employees for their policies tax-free up to the amount of their allowance.

According to Zane Benefits’ website, an employer would consider playing differently because it will likely:

  • Save employees and employers a combined 50% on health insurance costs.
  • Allow employees a full choice of health insurance plans.
  • Provide employees with better, more flexible health insurance options.

With the new Individual Health Insurance Marketplaces (guaranteed-issue and affordable because of the insurance premium tax subsidies), defined contribution plans now have all the same benefits of a group health insurance plan at a lower cost for the employer and employees.

Defined Contribution & Employee Health Insurance Cost Analysis

According to Zane Benefits’ website, to decide whether to play, pay or play differently with a defined contribution plan, an employer with over 50 employees should conduct a simple cost analysis. Compare the cost of the three options: Qualified, affordable group health insurance, a Defined Contribution Plan + applicable penalties, and Penalties.

Less Than 50 Employees?

According to Zane Benefits’ website, if a company has less than 50 employees, the mandate and tax penalty (and thus the play or pay decision) does not apply.

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About Zane Benefits

Zane Benefits was founded in 2006 to provide a revolutionized SaaS (Software-as-a-Service) administration platform ("ZaneHRA") for Health Reimbursement Arrangements (HRAs) and defined contribution health care. The flagship software provides a 100% paperless administration experience to employers and insurance professionals that want to offer better health benefits without a traditional group health insurance plan at lower costs. For more information about ZaneHRA, visit

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Christina Merhar
Zane Benefits
800-391-9209 6725
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