Are You Prepared for the ACA’s Information-Reporting Requirements?November 06, 2014
Beginning to collect data in January will be a huge help in 2016.
While the Affordable Care Act’s (ACA’s) shared-responsibility provision for “large” employers — and the penalty risks that go with it — may have drawn more attention, the associated information-reporting requirements shouldn’t be forgotten.
Both are scheduled to go into effect in 2015. But the transitional relief raising the 50 full-time employee (or the equivalent) threshold for large employer status to 100 for 2015 doesn’t apply to information-reporting. Therefore, these forms apply to applicable large employees who have an average of at least 50 full-time equivalent employees in the prior year.
Recently, the IRS released drafts of the information-reporting forms:
Form 1094-C, “Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns.” Employers will file this form with the IRS regardless of whether they offer health insurance. Some of the required information includes:
- Whether the employer is a member of an aggregated employer group for purposes of the requirements and, if so, the other members of the group
- A monthly breakdown of the number of full-time employees and all employees
- Whether minimum essential coverage was offered each month
- Whether the employer is eligible for transitional relief
Form 1095-C, “Employer-Provided Health Insurance Offer and Coverage.” Employers will complete and distribute this form to employees. Some of the required information includes:
- Type of coverage offered each month, such as whether it’s a “qualified” offer or, if not, which elements it does provide (minimum essential coverage? minimum value? etc.) and to whom (the employee, spouse and/or dependents)
- Data on the employee’s monthly share of the lowest cost monthly premium for self-only minimum value coverage
- Data on each family member covered, including Social Security number and the months of coverage
The IRS also has released draft instructions for completing these forms. The draft forms and instructions provide a helpful preview of the data you’ll likely need to gather.
Employers should determine whether their plan sponsor, insurer or payroll provider will prepare and file the forms. Confirmations should be in writing.
Although you won’t need to complete the forms until 2016 (for the 2015 calendar year), data collection and recordkeeping will need to begin in January. If you’re unsure what data you need to collect or how to get started, contact us. We can also address any questions you have about the shared-responsibility provision.