Brandlin & Associates
Brandlin & Associates NewsOctober 2013

Dollar Sign

Even though the Affordable Care Act (ACA or Obamacare) is headline news daily, its financial cost to businesses remains unclear.  How does a private equity firm assess the financial impact of the ACA on a portfolio company with 40 full-time employees (FTEs) acquiring a company with 20 FTEs?  How about two companies with fewer than 25 employees merging?  Does the ACA change the way a company forecasts "build vs. buy" strategies?

Affordable?  Or, Not? 


It is difficult to determine the ACA's effect on a business's bottom line with surety.  Afterall, Congress continues to use it as a bargaining chip and the regulations are still being written.  However, business owners and equity and debt providers can't sit on the sidelines waiting for resolution.  


We are helping our clients make business decisions by providing financial analyses based on the known facts.  Some of the ACA's key features affecting business owners beginning in 2015 are:

  1. 50/30 or $2,000:  Companies with at least 50 FTEs (working at least 30 hours/week) must provide affordable health insurance for their FTEs.  The annual penalty for failing to offer health insurance is $2,000 per FTE (non-tax deductible; excluding first 30 FTEs).    
  2. 9.5% max/60% min or $3,000:  To be considered "affordable," the maximum amount of an employee's premium costs under the employer's plan is 9.5% of annual household income, and the minimum coverage is 60% of medical costs.  The annual penalty for failing to offer affordable health insurance is $3,000 per FTE who qualifies for savings in the healthcare marketplace (non-tax deductible; excluding first 30 FTEs).    
  3. Under 25 rule:  Companies with fewer than 25 FTEs that provide health insurance may receive a tax credit. 

If you are interested in understanding the ACA's potential financial repercussions on a target acquisition or portfolio company, please give us a call at 310.789.1777.

About Brandlin & Associates
Brandlin Logo

Brandlin & Associates is an exclusive provider of accounting due diligence, financial consulting and strategic consulting services. We pride ourselves on offering superior technical expertise, years of practical experience and unparalleled service to decipher financial and operational performance metrics. As a result, our clients are able to make informed decisions in a timely manner.


Garret Martucci

Garret Martucci


View Bio


We are pleased to welcome Garret L. Martucci to the Brandlin & Associates team. Garret brings deep knowledge of process improvement methodologies to identify the budgetary impact of operational business decisions. 


Previously, Garret was with Grant Thornton's Advisory Practice where he assessed the operations of public sector entities and established and implemented process improvement initiatives. 


Garret earned his Six Sigma Green Belt Certification (CSSGB) from the American Society for Quality (ASQ) and graduated from The American University with a B.A. in Political Science.   

Brandlin & Associates



Join Our Mailing List