I have had a few questions already from Clients concerned about this new “fee.”  The purpose of the fee is to help fund Health Care Reform, pure and simple.  It should amount to about $25 Billion in new revenues to fund the legislation.  Even Democrats who were high on the bill now realize it is singificantly underfunded.  Health and Human Services will use the money to “…cushion health insurance companies from the initial, hard-to-predict costs of covering uninsured people with medical problems.”  Beginning January 1, 2014, insurers must take all comers.

The program “is intended to help millions of Americans purchase affordable health insurance, reduce unreimbursed usage of hospital and
other medical facilities by the uninsured and thereby lower medical expenses and premiums for all,” the Obama administration says in the
regulation. An accompanying media fact sheet issued Nov. 30 referred to “contributions” without detailing the total cost and scope of the
program.

One of the biggest complaints is that this fee will be paid by all, but does nothing for the group marketpleace- it goes to stabilize the individual marketplace.  It is expected that most employers will simply pass the fee onto their employees.