The Affordable Care Act Turns Six: Let’s Take a Look at the Year Ahead!

Six years ago, the Affordable Care Act (ACA) transformed healthcare and became part of the business landscape for every employer. Since then, we have seen significant changes in regulations, penalties and deadlines affecting employers of all sizes. Here are some of the aspects of the ACA to keep top of mind this year.

Mark your calendar for these important ACA-related dates: 
March 31, 2016: This is the deadline for applicable large employers (ALEs) to send out IRS form 1095-C to each full-time employee, notifying them of the types of health insurance coverage they were offered.  More information on determining if your company is an ALE can be found in this post on ACA for midsize employers.

June 30, 2016: The deadline for ALEs to file each employee’s information and the IRS form 1094-C electronically with the IRS (May 31 if not filing electronically).

Here are the rules you must comply with by your 2016 plan renewal:

• Companies with fewer than 50 full-time equivalent (FTE) employees in the states of CA, CO, CT, DC, DE, HI, IA, MA, MD, MN, NM, NY, NV, RI, VT and WA that provide health insurance to their employees will offer group plans that correspond to the ACA’s metal plans.
• This year, companies with 50 to 99 FTE employees in CA, CO, NY and VA will move to plans that correspond with the ACA’s metal plans as well.
• Companies with 50 to 99 FTE employees should be providing “substantially all” of their full-time employees with affordable health care or face penalties for non-compliance.

Companies with more than 100 FTE employees should already be providing “substantially all” of their full-time employees with affordable health care or face penalties for non-compliance.

Plan to comply with this rule by your 2017 plan renewal
Companies with fewer than 50 FTE employees in AK, AL, AZ, FL, GA, ID, IL , IN, KS, KY, LA, ME, MI, MO, MS, MT, NC, ND, NE, NH, NJ, OH, OK, OR,  PA, RI, SC, SD, TN, TX, UT, VA, WI and WV that provide health insurance to their employees must ensure that their group plans correspond to the ACA’s metal plans.

Why you can’t afford to wait another year
Is there too much on your plate this year for you to worry about the ACA? Shrugging it off till next year might prove to be a costly experience if one or more of your employees enrolls in subsidized coverage:

• ALEs not offering employer-sponsored plans to at least 95 percent of full-time employees and dependents may face penalties of up to $2,000 per full-time employee.
• Offering plans that do not meet the ACA affordability and minimum value requirements to employees can cost a company $3,000 per full-time employee who enrolls in subsidized marketplace coverage.
• Not providing each full-time employee with IRS form 1095-C can lead to a fine of up to $250 per missing statement (capped at $3 million in total penalties).
• Not filing each full-time employee’s information, along with form 1094-C, to the IRS can lead to a fine of up to $250 per violation (capped at $3 million in total penalties).
• Reimbursing employees for their individual health plans will now cost employers as much as $100 per day, per employee. That’s a $36,500 penalty per employee for the year.

A gentle reminder on some of the other ACA requirements you need to remember
If you are offering a group health plan, a summary of benefits and coverage must be issued to each employee. Additionally:

• A marketplace notification needs to be provided to each employee.
• Providing a written offer of enrollment in group coverage to newly eligible employees within 90 days of their eligibility is now mandatory (waiting periods cannot exceed 90 days).

The most important step you can take this year to be ACA compliant
Here’s the situation: the ACA can be overwhelming – and constantly changing legislation and requirements just add to the confusion. The best way you can stay compliant, avoid devastating penalty fees and remove the headache of having to worry about how the ACA affects your business is by hiring a professional to help you navigate the tricky waters of the ACA.

This communication is for informational purposes only; it is not legal, tax or accounting advice; and is not an offer to sell, buy or procure insurance.

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