Highlights of Employer ACA Reporting Requirements

By now, most of the American population is aware of their requirement under the Affordable Care Act (ACA) to have basic medical coverage. In addition, employers with 50 or more employees must offer affordable, minimum value coverage to their full-time employees. Failure in either case will result in a penalty owed to the Internal Revenue Service (IRS).

The IRS is responsible for verifying that individuals have the required coverage and large employers are meeting their shared responsibility ("play or pay") obligations. The IRS will be using Forms 1094 and 1095 to gather the information to administer penalties on those who owe them and to verify that tax credits are accurate.

Employers with self-funded plans will use either Form 1095-B or a specific section on Form 1095-C to report which months during the year the employee and covered family members actually had coverage in place. This reporting will meet the reporting requirements of Section 6055 of ACA.

The employer-shared responsibility requirement is based on offering coverage. Employers will use Form 1095-C to indicate whether coverage was offered in a month to a full-time employee and to the employee's spouse and children. Employers with 50 or more employees must provide this form to employees who worked full-time for one or more months during the year. This reporting will meet the reporting requirements of Section 6056 of PPACA. All employers that had 50 or more full-time or full-time equivalent employees in their controlled group during 2014 will need to provide reporting in early 2016, based on coverage offered during the 2015 calendar year. Although employers with 50 to 99 employees generally do not need to comply with the employer-shared responsibility/play or pay requirements for 2015, they do need to comply with the reporting requirement for 2015. Employers in this situation will enter a code on their Form 1094-C so the IRS will know that they are not subject to penalties for 2015.

An employer that had fewer than 50 full-time and full-time equivalent employees in its controlled group during 2014 and that offers coverage through a fully insured plan will not need to do reporting for 2015. The carrier will provide the required reporting (using Form 1095-B) to employees and dependents that had coverage during 2015. All other employers -- those that are self-funded regardless of size, and those with 50 or more employees in their controlled group, whether coverage is fully insured, self-funded, or not offered at all -- will need to do reporting in early 2016 based on 2015 coverage.

This reporting will be done on a calendar year basis, even for non-calendar year plans. Reporting will first be due in early 2016, based on coverage offered or provided during 2015.

Confused by all the ACA employer requirements? The CIOMA Employee Benefits Program includes solutions for maintaining benefits-related compliance. Contact the team at Maniaci Insurance Services at 866-541-4824 or mail@maniaciinsurance.comfor more information.

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Maniaci Insurance Services
Tel: (310) 541-4824

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