Learn Your Obligations as an Employer
Employers with fewer than 11 FTEs:
- Are not required to offer health benefits or a Section 125 Plan
- May still want to set up Section 125 Plan for their employees because it will reduce taxes for both the employer and the employees
- May offer their employees health benefits and a Section 125 Plan through the Health Connector’s Commonwealth Choice Program
Employers with 11 or more FTEs
- Must offer a Section 125 plan that meets Health Connector regulations to most part-time and all full-time employees.
- Companies without Section 125 plans whose workers access medical care through the state's Health Safety Net may be assessed a penalty between 20% and 100% of the cost of these medical services that exceed $50,000.
- Section 125 Plans allow employees to pay for health coverage on a pre-tax basis. Employers with less that 11 FTE employees may still offer a Section 125 Plan without making a contribution; the employer and employee will have lower payroll-related taxes.
- Employers of 11 or more full-time-equivalent employees (FTEs) will pay an annual Fair Share Contribution of up to $295 per employee if they do not make a “fair and reasonable” contribution to an employee health plan.
For more information please visit the Massachusetts Health Connector Employer Obligation pages.