BACKGROUND/HISTORY
January 2013: IRS published a proposed regulation for the shared responsibility requirement under the Affordable Care Act (ACA). In summary, large employers must offer full-time employees health coverage that is affordable and provides minimum value beginning in 2014. Employers that failed to offer minimum essential coverage to its full time employees and their dependents may be subject to a “play or pay” penalty if any full-time employees enroll in Exchange coverage.
• July 2013: Announcement is made that the shared responsibility requirement has been delayed one year until 2015.
• February 2014: IRS released final regulations on the employer shared responsibility requirements. Although the requirement becomes effective in 2015 an exception has been made for employers with 50 to 99 lives. These employers are exempt from this requirement until 2016.
SUMMARY OF THE SHARED RESPONSIBILITY REQUIRMENT (EMPLOYER MANDATE) FINAL REGULATION
On February 10, 2014 the IRS published the final regulation on the Shared Responsibility Requirement (Employer Mandate). The significant change is for mid-sized businesses that employ 50 to 99 full-time workers. These employers will have until 2016 to provide health insurance coverage to employees and will not be subject to penalties.
Large employers with 100 or more full-time workers will still be subject to the mandate starting in 2015. The change that should be noted for large employers is that they only need offer coverage to 70% of workers in 2015, rather than 95%. This will change to 95% of workers in 2016.
Please review the FACT SHEET provided by the IRS for detailed information on the final rule