Pieces of ACA delayed in final regulations
The Treasury published final regulations February 10, 2014 for large employers issuing health care coverage to their employees under ACA. For employers with 50 to 99 employees, which qualify as “large employers” under Section 4980H’s employer shared responsibility requirement, the final rules will not be enforced until 2016. Employers with 100 or more employees, however, must offer coverage to 70 percent of their qualifying employees in 2015 and 95 percent in 2016.
ACA small employer tax credit regulations proposed
The IRS released proposed regulations in August for calculating the small employer tax credit under Section 45R, which may affect certain tax exempt organizations with 25 or fewer full-time equivalent employees. Eligibility requirements for the credit, methodology for determining the amount deductible, and guidance for claiming the credit in annual tax filings are among the items detailed in the updated proposal. Meanwhile, the IRS has launched a full-scale website in advance of ACA implementation, provisions of which go into effect October 1, to serve as a resource for individual taxpayers and employers.
Portion of health care implementation delayed
The White House announced July 2, 2013 its plan to postpone until 2015 the portion of the ACA requiring employers to provide health insurance to its employees and certain reporting requirements.
Small Employer Credit
Nonprofit Employer Health Insurance Coverage
final rule on the definition of essential health benefits (EHBs), the determination of actuarial value in the individual and small group markets, and the minimum value (MV) standard for large employers. The final rule implements a requirement in the ACA that the plans cover essential health benefits (EHBs) for 10 categories of care, including basic services such as hospitalization and emergency care, as well as mental health and maternity care. In addition, it has posted a MV standard calculator for employers to determine whether their offered coverage meets minimum requirements to avoid penalty excise taxes for unaffordable coverage.
Shared Responsibility Provisions
The IRS finalized regulations (TD 9655) on the shared responsibility provisions under the ACA in February 2014. New tax code Section 4980H requires employers with at least 50 full-time and/or full-time equivalent employees to offer affordable health care coverage to provide a minimum level of coverage, or pay a penalty. The rules phase-in for employers with 100 or more employees beginning in 2015 and for those with 50 to 99 employees in 2016. An employee is considered full-time if he or she works at least 30 hours per week, or 130 hours in a calendar month. Volunteers do not count towards the total number of employees under the law.
Grandfathered plans are allowed to make routine changes to their coverage structures, which includes changing insurers for group health coverage, so long as the same level of coverage is maintained. Any of the following plan changes will result in an immediate and permanent loss of grandfathered status:
Implementation timeline (PDF) - Key effective dates for health care reforms
Department of Health and Human Services (HHS) guidance - Implementation resources for individuals / employers
Department of Labor (DOL) guidance - Regulatory information for employers