WASHINGTON - Today, the U.S. Department of the Treasury and the Internal
Revenue Service (IRS) released final rules to implement the information
reporting provisions for insurers and certain employers under the ACA that take
effect in 2015.
“Today’s announcement is part of the Administration’s effort
to provide certainty and early guidance about major health policies so
employers, small business owners and other individuals can plan for 2015,” said
Assistant Secretary for Tax Policy Mark J. Mazur. “Treasury’s final rules significantly
streamline and simplify information reporting while making it easier for
employers and insurers of all sizes to provide the quality, affordable health
coverage that every American deserves.”
While 96 percent of employers are not subject to ACA
reporting requirements or the employer responsibility provision because they
have fewer than 50 employees, in 2015 requirements begin to phase-in for the
remaining four percent of employers that are required to offer quality,
affordable coverage to employees or make a payment. The final regulations released today on
information reporting by those employers will substantially streamline
reporting requirements for employers, particularly those that offer highly
affordable coverage to full-time employees. Final rules were also
released today to provide guidance for reporting by insurers and other parties
that provide health coverage under the ACA. Together, these rules respond to feedback from
stakeholders and will help employers and insurers effectively comply with their
responsibilities.
Today’s final rules include the following key provisions:
Single, Combined Form
for Information Reporting
·
Employers that “self-insure” will have a
streamlined way to report under both the employer and insurer reporting
provisions. Responding to widespread
requests, the final rules provide for a single, consolidated form that
employers will use to report to the IRS and employees under both sections 6055
and 6056, thereby simplifying the process and avoiding duplicative
reporting. The combined form will have
two sections: the top half includes the information needed for section 6056
reporting, while the bottom half includes the information needed for section
6055.
o
Employers that have fewer than 50 full-time employees
are exempt from the ACA employer shared responsibility provisions and therefore
from the employer reporting requirements.
o
Employers that are large enough to be subject to
the employer responsibility provisions and that “self-insure” will complete both
parts of the combined form for information reporting.
o
Employers that are subject to employer responsibility
but do not “self-insure” will complete only the top section of the combined
form (reporting for section 6056). Insurers and other providers of health
coverage will report only under section 6055, using a separate form for that
purpose. Insurers do not have to report
on enrollees in the Health Insurance Marketplace, since the Marketplace will
already be providing information on individuals’ coverage there.
Simplified Option for
Employer Reporting
·
For employers that provide a “qualifying offer”
to any of their full time employees, the final rules provide a simplified
alternative to reporting monthly, employee-specific information on those
employees.
o
A qualifying offer is an offer of minimum value
coverage that provides employee-only coverage at a cost to the employee of no
more than about $1,100 in 2015 (9.5 percent of the Federal Poverty Level),
combined with an offer of coverage for the employee’s family.
o
For employees who receive qualifying offers for
all 12 months of the year, employers will need to report only the names,
addresses, and taxpayer identification numbers (TINs) of those employees and
the fact that they received a full-year qualifying offer. Employers will also give the employees a copy
of that simplified report or a standard statement indicating that the employee received
a full-year qualifying offer.
o
For employees who receive a qualifying offer for
fewer than all 12 months of the year, employers will be able to simplify
reporting to the IRS and to employees for each of those months by simply
entering a code indicating that the qualifying offer was made.
o
To provide for a phase-in of the simplified
option, employers certifying that they have made a qualifying offer to at least
95% of their full-time employees (plus an offer to their families) will be able
to use an even simpler alternative reporting method for 2015. Those employers will be able to use the
simplified, streamlined reporting method for their entire workforce, including
for any employees who do not receive a qualifying offer for the full year. Those employers will provide employees with
standard statements relating to their possible eligibility for premium tax
credits.
·
The final regulations
also give employers the option to avoid identifying in the report which of its
employees are full-time, and instead to just include in the report those
employees who may be full-time. To take advantage of this option, the
employer must certify that it offered affordable, minimum value coverage to at
least 98 percent of the employees on whom it is reporting.
What Information Is
Reported
The
statute calls for employers, insurers, and other reporting entities to report information
including:
- For section 6055
- Information
about the entity providing coverage, including contact information.
- Which individuals
are enrolled in coverage, with identifying information and the months for
which they were covered.
- For section 6056
- Information
about the employer offering coverage (including contact information and
the number of full-time employees).
- For each
full-time employee, information about the coverage (if any) offered to the
employee, by month, including the lowest employee cost of self-only
coverage offered.
·
Streamlined
information: The final rules omit
data elements in the statute that are not necessary to understanding coverage
offered and provided, in the interest of streamlining. These include (but are not limited to):
o
The length of any waiting period;
o
Employer’s share of the total allowed costs of benefits provided
under the plan;
o
The amount of advance
payments of the premium tax credit and cost-sharing reductions.
For more information, see sections 6055 and 6056 final
regulations here.
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