Author: Tracy Morley, XpertHR Legal Editor

On August 6, 2012, the Governor of Massachusetts signed into law Senate Bill 2400, the Massachusetts Health Care Cost Bill. The new law is aimed at improving the quality of health care and reducing costs through increased transparency, efficiency and innovation.

Beginning January 1, 2013, employers that offer wellness programs may be eligible to receive a tax credit equal to 25 percent of the costs associated with implementing a wellness program, up to a maximum credit of $10,000 in a fiscal year. The tax credit cannot reduce the taxes an employer owes below zero, but unused credits may be carried over and applied to future taxes for up to five years.

Employers often use wellness programs as part of the overall benefits strategy to engage employees in living more healthful lifestyles, which in turn, can help to manage health care costs. When designing a wellness program, employers should ensure that the programs do not unlawfully discriminate against employees and comply with the Health Insurance Portability and Accountability Act (HIPAA), the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA).

The new law also expands the role of the Health Connector and makes changes to an employer's Fair Share Contribution requirement.

Health Connector

Health Connector (the Connector) is the state agency that helps Massachusetts residents and employers find the right health insurance. In addition to its current responsibilities, the Connector will take on the additional responsibilities of issuing the Health Insurance Responsibility Disclosure (HIRD) form and for ensuring compliance with the Free Rider Surcharge.

Fair Share Contribution Requirement

Effective July 1, 2013, the new law makes two changes to the Fair Share Contribution Requirement.

  1. It increases the full time equivalent (FTE) threshold for fair share contributions from 11 FTEs to 21 FTEs.
  2. It provides that employees, who have qualifying health insurance coverage from other sources, not be included for the purpose of determining whether an employer is a contributing employer.

Continue to check XpertHR for the latest news on this and other key HR compliance issues.

Additional Resources

Employee Benefits > Health Care Benefits: Massachusetts

Employee Benefits > Managing Health Care Costs > Wellness and Prevention Programs

Employee Benefits > Health Information and Privacy (HIPAA)

Employee Management > EEO - Discrimination > Disability - Americans with Disabilities Act

Employee Management > EEO - Discrimination > Genetic Information - Genetic Information Nondiscrimination Act