Healthcare Reform Timeline

Large Employers

 
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What You Need to Know About Healthcare Reform
 

  1. Starting in 2015, you must offer affordable coverage to avoid penalties.
  2. You purchase health coverage as you always have.
  3. There are new tax reporting requirements for the 2015 calendar year.

1. Starting in 2015, you must offer affordable coverage to avoid penalties.

To avoid paying penalties in 2015, employers with 100 or more full-time employees or a combination of full-time employees and full-time equivalent employees must offer affordable coverage to at least 70 percent of full-time employees and their dependents (children, but not spouses). In 2016 and beyond, employers with 50 or more full-time employees or a combination of full-time and full-time equivalent employees must offer affordable coverage to at least 95% of their full-time employees and their dependents (children, but not spouses).

Here is what employers need to offer to avoid penalties:

  • Coverage that is affordable, meaning that the employee's share is not greater than 9.5 percent of their household income. An employer may use the employee's W-2 wages to determine affordability. Whether coverage is affordable is based on the lowest cost individual-only plan available to the employee, even if the employee chooses family coverage.
  • A plan that provides at least minimum value, which means that the plan's estimated share of benefits provided is at least 60 percent of typical healthcare costs. (Employees pay the rest.)
  • A plan that offers minimum essential coverage. You meet this requirement by offering a comprehensive medical plan.

To find out if you may incur a penalty, please see this infographic. All penalties are assessed by the IRS and are assessed as an excise tax.

2. You purchase health coverage as you always have.

At this time, large employers are not able to purchase through HealthSource RI, our state's health insurance marketplace  (also called an exchange). So you’ll continue to buy plans through a broker or directly from Blue Cross. In 2016, employers with fewer than 100 employees will be considered "small employers" and eligible to purchase through the Small Business Health Options Program (SHOP) through HealthSource RI. For 2017 coverage, states will have the ability to approve large employers (100 or more employees) to buy plans through the SHOP program.

3. There are new tax reporting requirements for the 2015 calendar year.

Both fully insured and self-funded large employer groups will be required to provide the IRS as well as individuals with detailed health coverage information for the 2015 calendar year. This information, which will be included in standard forms that are being finalized by the IRS, will enable the IRS to determine if both employers and individuals are complying with the Affordable Care Act.

Here’s what large employers need to know about these requirements:

  • Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns. This form must be filed with the IRS along with Form 1095-C by February 29, 2016 (paper filing) or March 31, 2016 (electronic filing). 
  • Form 1095-CEmployer-Provided Health Insurance Offer and Coverage. This information return must be filed with the IRS, and a copy must be provided to the employee by February 1, 2016