The University of Missouri will stop providing subsidies to its graduate students to help them buy health insurance due to an IRS rule linked to the Patient Protection and Affordable Care Act.
While the PPACA levies a $2000-per-employee fine on large employers who do not provide health insurance for workers, a recent IRS interpretation of the legislation determined that employers are subject to even greater fines if they offer cash to employees in lieu of insurance. Those employers can be fined $100 a day—or up to $36,500 a year.
Facing the prospect of such heavy fines, the university will stop helping students pay for health care. Instead, it will direct the money towards fellowships to help grad students pay for tuition, books, housing and other expenses.
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