Now that President Obama's health care reform is going forward, automotive businesses of varied sizes are assessing their options.
For General Motors and other major corporations, the U.S. Supreme Court's 5-4 decision to uphold the Affordable Care Act makes little difference. They cover their employees and plan to keep doing so.
But some car dealerships have some big decisions to make. If they have more than 50 employees, they'll be required to insure them by 2014.
Judith Krupnick, president of Cherry Hill Volvo of Cherry Hill, N.J., said her executive team is looking at options.
She provides insurance for 23 of her 60 employees. But the law requires her to insure all full-time employees or pay a $2,000 tax annually for every full-time employee, according to the Democratic Policy and Communications Center, which researches issues for Democratic U.S. senators.
Krupnick said the fines would be "substantially less expensive" than providing the coverage, she said. She said she now pays about $6,000 per employee for their coverage.
But dealerships that drop coverage for employees and pay the fines risk losing valuable employees who expect health insurance. The vast majority of dealerships now provide health coverage, says the National Automobile Dealers Association.
Companies with fewer than 50 full-time employees will not be required to offer coverage. In 2011, the average U.S. dealership employed 53 people, according to NADA.
NADA, which opposed the law from the start, restated its opposition after the ruling.
In a statement last week, NADA said: "The resources that dealers must put toward meeting these new health care mandates prevent them from growing their businesses and, in many cases, hinder their ability to offer quality health care plans to their employees.
"Congress should revisit this law to ensure that dealership employees are not forced out of employer-based health care plans."
Starting in 2014, companies with fewer than 100 employees can buy insurance through state-based small business health insurance exchanges. In 2017, states could allow businesses with more than 100 employees into the exchanges.
The exchanges, designed to increase competition, are marketplaces that offer standardized health plans available from insurance companies.
Dealer Krupnick said because much is unknown with the health care law, she's still weighing her options.
Krupnick said she is concerned about forcing her staff to shop for their own, possibly substandard, insurance.
"It's a shame to put employees through all that," she said. She does not provide coverage now to some employees for various reasons; for instance, some are covered by a spouse's insurance. Her six part-time employees do not have health insurance coverage.
Krupnick also could purchase insurance through her state's small-business exchange.
For businesses with no more than 25 full-time equivalent employees and average annual wages of less than $50,000, the law provides tax credits to help meet the cost of providing health insurance. Though these businesses are not required to provide coverage, the tax credits are meant to be an incentive to do so.
Heather Rosenker, policy director for General Motors, which self-insures its health care coverage, said GM is not considering dropping coverage for any employees.
"General Motors' hourly and salaried health care programs are in compliance with the provisions of the federal health care law," the company said in a statement. "Therefore, it would appear that the Supreme Court's ruling upholding the law will not affect the administration of our programs."
David Phillips contributed to this report