The 5 Ws of the ACA Employer Mandate: What you need to do to comply

The 5 Ws of the ACA Employer Mandate: What you need to do to comply

Estimated Reading Time: 3 Minutes


The Affordable Care Act’s employer mandate has been in effect for almost one year, but there is still a lot of confusion around ensuring companies are compliant. Known as Employer Shared Responsibility or “Play or Pay,” the mandate’s goal is to reduce the number of uninsured people in the U.S. by promoting and encouraging employer-sponsored health benefits.

However, just because your Wisconsin business is offering employee health benefit solutions, it doesn’t mean you are ACA compliant. Many employers are required to file information returns and provide statements to full-time employees about the benefit solutions being offered.

To assist in ensuring your business is compliant, we will be exploring the 5 W’s of the ACA Employer Mandate over the course of the next few weeks, answering the questions before you have to ask.

What to do to comply with the ACA employer mandate

If you have identified your WIsconsin company as an Applicable Large Employer (ALE), there are mandatory ACA employer reporting requirements and paperwork to complete and submit. If you need assistance in calculating whether you are an ALE, contact your Employee Benefits Consultant.

Information that is required by the IRS includes identification of the ALE, identification of the full-time employees who receive an offer of coverage and the duration of said offer. A statement must be furnished to all full-time employees that include the identification of the employer and the same information that is reported to the IRS for each full-time employee.

Which forms are required for 2016?

Form 1095-B: Health Coverage

This form must be filed with the IRS and provided to taxpayers by insurers, as well as by self-insured employers who do not fall under the shared responsibility mandate. The form verifies that individuals have minimum essential coverage that complies with ACA requirements.

These forms include the following information:

  • Full-time employees
  • Total headcount
  • If minimum essential covered was offered
  • Whether an applicable 4980H “Safe Harbor” was used

Form 1095-C: Employer-Provided Health Insurance Offer and Coverage

This form is to be filed by employers with 50 or more full-time or full-time equivalent employees, verifying compliance with the ACA employer mandate. This is used to establish employee eligibility for premium tax credits ir affordable and adequate coverage is not offered. Determining whether employer sponsored coverage is affordable is also difficult calculation to navigate. If assistance is needed contact an employee benefit expert at Infinity Benefit Solutions, Inc.

The 1095-C forms include the following information:

  • Proof of offer of coverage (with code)
  • Employee’s share of the lowest cost monthly premium
  • Whether an applicable 4980H “Safe Harbor” was used

Form 1094-B: Transmittal of Health Coverage Information Returns & Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns

These transmittal forms are used by insurers and employers to transmit individual 1095-B and 1095-C forms to the IRS.

The ACA employer mandate can be difficult to navigate, so by working with a Milwaukee insurance broker/consultant, you can ensure you are remaining compliant and following all necessary regulations.




Leave a reply

Your email address will not be published. Required fields are marked *