What are UHI Contributions and how do they work?
Question: What is UHI?
Answer: The Massachusetts Division of Unemployment Assistance provides health insurance assistance through the Medical Security Program for residents of the Commonwealth who are receiving unemployment insurance benefits. Massachusetts is the only state in the nation to offer a health care plan for eligible unemployment insurance claimants, by providing assistance with the cost of existing health insurance premiums or by covering the cost of actual medical expenses.
Question: What is UHI and what are UHI Contributions? How do they work?
Answer: DUA has been administering the Unemployment Health Insurance ("UHI") Program since 1990, which requires a contribution from certain employers who have an average of at least 6 or more employees in a quarter. The UHI contribution is based on one of three tax rates, depending upon the length of time an employer has been subject to the MGL 151A law. The assigned UHI tax rate is applied to the first $14,000 in wages paid to each employee during the calendar year. The UHI contributions paid by employers are deposited into the Medical Security Trust Fund, and enables DUA to provide health coverage to qualified and income-eligible Unemployment Insurance (UI) claimants while they are unemployed and collecting UI benefits. All newly subject employers in Massachusetts subject to MGL 151A are exempt for the first two years. Beginning year 3 employers determined to be liable will be required to pay quarterly for any quarter in which they average at least 6 or more employees.