Starting in January 2015, the Affordable Care Act (ACA) requires employers to significantly increase their information reporting responsibilities. For example, if your small business (fewer than 50 employees) provides self-insured health coverage to your employees, you must file an annual return reporting certain information for each employee you cover.
For larger employers (50 or more employees), the reporting requirements are even greater. Starting in calendar year 2015, large employers must file an annual return reporting whether and what health insurance you offered your employees. In addition, if large employers provide self-insured health coverage to employees, they also will have to file an annual return reporting certain information for each employee covered. All three of these rules were optional in 2014.
The table below, created by McGladrey, shows a basic overview of what forms are required in different circumstances.
|Employer Size||Employer Health Plan||Employer Files Forms 1095-B/1094-B||Employer Files Forms 1095-C/1095-B|
|Small employer||Insured||No (insurer files forms)||No|
|Small employer treated as large||None||No||Yes|
|Small employer treated as large||Insured||No (insurer files forms)||Yes|
|Small employer treated as large||Self-insured||Yes||Yes|
|Large employer||Insured||No (insurer files forms)||Yes|
|Large employer||Self-insured||Generally, no||Yes|
Unfortunately, knowing which form to use is only part of the battle. The real question is whether or not you have the infrastructure in place to manage the requisite information.
Form 1095-C alone requires this information reported to the IRS:
- The employee’s name, address, and Social Security number
- The employer’s name, address, and employer identification number
- Whether the employee and family members were offered health coverage each month that met the minimum value standard
- The employee’s share of the monthly premium for the lowest-cost minimum value health insurance coverage offered
- Whether the employee was a full-time employee each month
- The affordability safe harbor applicable for the employee
- Whether the employee was enrolled in the health insurance plan
- If the health insurance plan was self-insured, and the name and Social Security number of each employee and family member covered by the plan by month
Do you have a plan in place to collect this data? If not, now is the time to consider how you will gather and track this information. Excel spreadsheets, manual calculations, and ad-hoc reporting may feel comfortable because of familiarity; but comfortable isn’t always compliant or easy. Due to the potential for steep penalties, employers need a reliable solution (such as the AmeriFlex Workforce ACA Compliance Monitoring Module) that offers visibility and flexibility to adapt to new requirements down the road.
If you are unsure if your infrastructure can meet the demands of the 2015 ACA reporting requirements, contact us today for a free consultation.