Provisions of new health care law will roll out over time

The passage of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act, signed into law by President Obama on March 23, won’t mean overnight change. Most of the pertinent provisions of the legislation will not take affect for some years—including pieces important to nonprofits. According to Rick Cohen of Nonprofit Quarterly, the nonprofit-specific provisions include these:

In 2010, nonprofit employers with less than 25 employees will be eligible for government subsidization of the costs of providing health insurance to their employees. The total subsidy – for nonprofit employers between 2010 and 2013, taken against the employer match for employee withholding for Social Security and Medicare – is capped at 25 percent of the organization’s health insurance costs (for-profits start at 35 percent). The average wage paid, however, has to be $50,000 or less.

In 2014, the cap on government subsidization of eligible small nonprofit employer costs rises to 35 percent (lower than the for-profit employer cap, which also rises in 2014). However, that only happens if the nonprofits purchase insurance on state-established nonprofit exchanges.

2012 will see the long-promised nonprofit insurance co-ops created to compete with for-profit, and other nonprofit insurers.

Click here for a further breakdown of how health care reform will roll out.