More than five years after its enactment, the Affordable Care Act (“ACA”) continues to be one of the top concerns for employers, and rightfully so: the ACA is one of the most comprehensive laws impacting employee benefits since the Employee Retirement Income Security Act (ERISA) of 1974. The deadline for arguably one of the most daunting requirements of the ACA, employer reporting, is quickly approaching.
WHAT ARE THE ACA REPORTING REQUIREMENTS?
Health insurance issuers, self-insured employers, government agencies, and any other entity that provides minimum essential coverage to an individual during the calendar year must report certain information about the health insurance coverage provided to the Internal Revenue Service (“IRS”). Applicable large employers (“ALE”) must report to the IRS regarding whether health coverage was offered, and if so, must provide details about the health care coverage offered to full-time employees.
A previous Pugh publication defined applicable large employer and provided details for determining applicable large employer status. Click HERE to view this publication.
WHY MUST PROVIDERS AND EMPLOYERS REPORT?
This reporting will provide the IRS with information to enforce both the individual mandate and the employer mandate. The IRS will also use these reports to administer premium tax credits for individuals buying coverage on state exchanges.
HOW DO EMPLOYERS COMPLY WITH THE ACA REPORTING REQUIREMENTS?
Reporting by health coverage providers
Every person who provides minimum essential coverage (“MEC”) to an individual during a calendar year must file an information return and a transmittal. Most filers will use transmittal Form 1094-B and information return Form 1095-B. However, employers – including government employers – sponsoring self-insured group health plans will report information about the coverage in Part III of Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, instead of on Form 1095-B.
Employers with fewer than 50 employees that are not subject to the employer shared responsibility provisions, but who sponsor self-insured group health plans, will use Forms 1094-B and 1095-B to report information about covered individuals.
Reporting by ALEs
Employers with 50 or more full-time employees, including full-time equivalent employees, will use transmittal Form 1094-C and information return Form 1095-C to report the information required under the ACA about offers of health coverage and enrollment in health coverage for their employees. In addition to reporting the coverage that they offer, ALEs who sponsor self-insured group health plans will use Forms 1094-C and 1095-C to report information about the coverage they provide to the covered individuals.
Click HERE to view this information in chart form.
WHEN IS THE REPORTING DEADLINE?
Forms must be properly addressed and mailed on or before the due date below:
- Forms 1095-B and 1095-C must be furnished to individuals by March 31, 2016 (extended from February 1, 2016.)
- Forms 1094-B, 1095-B, 1094-C and 1095-C must be filed with the IRS by May 31, 2016 (extended from February 29, 2016), if filing on paper, or June 30, 2016 (extended from March 31, 2016), if filing electronically.
Pugh CPAs has received several questions related to Form 1095-C. Click HERE to view Form 1095-C with helpful tips. Click HERE to view Form 1095-C line 14 codes.
EMPLOYER ACTION ITEMS:
Employers need to track the following information to aid in completing the forms detailed above:
- Date of hire
- Termination date
- ACA full-time status date
- State of residence
- Proof of offering
- Status indicator (i.e., enrolled/waived)
- Plan funding (i.e., insured/self-insured)
- Employee share of lowest cost monthly premium, for self-only coverage
- Hours worked and paid
- Hours not worked but paid
- Payroll period begin / end date
- Jury Duty
- Other state mandated leaves
- Start / End dates of leave
- Intermittent FMLA time / dates
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OBAMACARE: INDIVIDUAL MANDATE