[firm] blog logo

Healthcare Reform Tip: Planning for the Employer Penalty

?Ç£Large employers?Ç¥ (employers with at least 50 full-time and full-time equivalent employees) may be subject to a PPACA penalty in 2014 if the employer?ÇÖs group health coverage does not meet certain requirements imposed by PPACA. A short summary of action steps to help employers plan for the penalty?ÇÖs avoidance can be found?áhere.

Guidance Released Regarding ?Ç£Affordability?Ç¥ Requirement for Dependent Coverage

The IRS issued final regulations confirming that, for purposes of determining eligibility for the premium tax credit under PPACA, coverage is considered affordable for dependents if the employee must pay not more than 9.5 percent of household income for employee-only coverage. Employers wishing to offer ?Ç£affordable?Ç¥ coverage in order to minimize the penalty on healthcare coverage that is effective in 2014 must only ensure that the premium charged for employee-only coverage meets this 9.5 percent test. The final regulations can be found here.

Guidance Released Regarding Requirement of Individuals to Maintain Minimum Essential Coverage

Proposed rules were released regarding individuals who are exempt from the requirement under the Patient Protection and Affordable Care Act (?Ç£PPACA?Ç¥) to maintain ?Ç£minimum essential health coverage,?Ç¥ and expanding the definition of what constitutes such minimum essential health coverage. The IRS also released proposed rules regarding an individual?ÇÖs liability for a ?Ç£shared responsibility payment?Ç¥ due to a failure to maintain minimum essential health coverage. The proposed rules can be found?áhere?áand here.

February 2013