Since the U.S. Supreme Court’s 5-4 decision upholding the constitutionality of the Affordable Care Act (“AFA”), also known as Obamacare, businesses have been dragging their feet, cautiously hopeful that Mitt Romney will be elected president and the new healthcare law and its costly rules for employers will be repealed.  Obama’s reelection on November 6, however, makes this new law a reality.  Businesses can no longer afford to delay the implementation of these new regulations; those who do face hefty penalties.

The Obama Administration is rolling out an average of 68 new regulations every day.  None, however, weighs more heavily on the minds of business owners than that of the AFA requiring businesses with over fifty employees to provide high-quality affordable health insurance.  Starting in 2014, employers who fail to comply with this law will be heavily fined.

Here’s how it works.  If a business has more than fifty employees, it must provide health insurance.  If it does not provide health insurance, but at least one employee receives a government subsidy in the form of a premium tax credit to purchase private health insurance, then that business is fined $2,000 for every employee after the first thirty employees each year it does not comply.  This amounts to a minimum annual fine of $40,000.

If a business provides health insurance, but it covers less than sixty percent of health costs for a typical person or its annual premiums cost more than 9.5 percent of the employee’s family income, and at least one employee receives a premium tax credit, then that business is fined $3,000 for every employee receiving a premium tax credit and an additional $2,000 for every employee after the first thirty employees each year it does not comply.

A study has found that because of the increased coverage mandated by the AFA, businesses of 101-1000 employees can expect to pay 9.5 percent more for health insurance while businesses of over 1000 employees can expect to pay 4.3 percent more.  Businesses of 100 or fewer employees, however, can actually expect to pay 1.4 percent less because they are exempt from providing coverage and because those with fewer than 25 employees actually receive large tax credits (35 percent in 2012 and 50 percent in 2013) for contributions toward health insurance for their employees.

While these regulations are supposed to decrease health care costs in the long-run, insurance premiums are estimated to increase by 6.3 percent in 2013, a burden likely to be borne primarily by a low and middle income workforce.  In a recent survey of small businesses, fifty eight percent plan to shift rising premium costs to employees.  Additionally, many businesses are planning hiring freezes if not layoffs.  But it’s not just the small businesses feeling the financial pressure of these new regulations.  Even retail giant Walmart is expected to see its employees’ health insurance premiums increase up to 36 percent, prompting some workers to drop coverage entirely.

Furthermore, businesses now have to report the cost of health insurance coverage on their employees’ Forms W-2, wage and tax statements, prompting concern among business owners that their administrative costs are going to rise.

And so, the Affordable Care Act appears to be a double edged sword.  On one hand, more Americans will be insured than ever before.  But on the other, those who are insured through their employers are likely to take home smaller paychecks than they have in the past.  As the increase in healthcare premiums outpaces that of Americans’ take-home pay and companies continue to deflect costs onto their workers, some employees may soon join in their employers’ apprehension of the AFA.