ACA Reporting Checklist for Self-Insured Employer Plan Sponsors

Transcription

1 ACA Reporting Checklist for Self-Insured Employer Plan Sponsors IRC Section 6055 EMPLOYER TASK CHECKLIST WHAT NEEDS TO BE DONE Define employer s status as a controlled group or member of a controlled group and decide if each member will report on their own or if the controlled group will report for all members Provide identity and contact information for person or persons responsible for being the contact for employee statements/questions Obtain Taxpayer Identification Number (TIN) for each employee or former employee covered under the plan. Obtain Taxpayer Identification Number (TIN) for other related individuals covered under the plan (e.g., spouse, children) Establish process for obtaining TIN data for new hires and family members covered under the plan Each member employer group will be liable for timely and accurate reporting. Contact person need not be an employee of the self-insured group plan sponsor; may be a third party. Get TIN from employment records; including ex-employees such as COBRA continuants. If TIN is not obtainable, get date of birth data. Get TIN via employment hire forms Include TIN request in health plan enrollment forms Get TIN data by of the year in which coverage for the individual begins (1-31 of the following year for individuals whose coverage begins in December) Establish 2 nd request process for getting TINs A second solicitation of the TIN is required by of the following year If the TIN is still not provided, the reporting entity is considered to have made a reasonable effort to do so and further solicitation is not required Provided by: Next Generation Healthcare Economics Page 1

2 Maintain current address list for plan participants Track monthly dates of coverage Option: Provide 6055 statements to employees Provide statements to individuals covered in report to IRS by January 31 st of each year (February 1 st for 2016) File form 1095-C by February 28 th (February 29 th for 2016) if filing by paper; electronic filing deadline is March 31 st. (see next page for additional instructions) Require employees and all other covered individuals, including continuants and retirees (if covered under the plan) to provide current and, when applicable, updated address information Employers must track coverage by applicable date of coverage range; not just by start and end dates Consent may be obtained from employees on the same form used to obtain consent to provide Form W-2 electronically, as long as Form 1095 is specifically mentioned in the request and all conditions for electronic provision are met Use form 1095-C IRS may grant a 30 day extension upon employer showing good cause Must provide statements to next of kin for deceased individuals in the year of their death Sending information via first class mail to last known address discharges the employer s obligations, even if the statement is returned. Must provide 6055 and 6056 information to employees in a single statement The section 6055 portion of form 1095-C must contain: The name, address and employer id number (EIN) of the employer plan sponsor The name and TIN of the covered employee The name and TIN of any related individuals covered under the plan (date of birth in lieu of TIN if unable to obtain) Provided by: Next Generation Healthcare Economics Page 2

3 File form 1095-C by February 28 th (February 29 th for 2016) if filing by paper; electronic filing deadline is March 31 st. (continued) Filing corrections to form 1095-Cs The months during which the individuals were covered under the plan Form 1095-C must be filed electronically if the self-insured employer plan sponsor is required to file 250 or more form Cs. Section 6055 reporting entities that are not applicable large employers or are not reporting as employers, such as the sponsors of multi-employer plans will report using form 1095-B. Assessments (penalties) are reduced if a corrected return is filed within 30 days of the due date of the original return filing. Provided by: Next Generation Healthcare Economics Page 3

4 ACA Reporting Checklist for Self-Insured Employer Plan Sponsors IRC Section 6056 EMPLOYER TASK CHECKLIST WHAT NEEDS TO BE DONE Define employer s status as a controlled group or member of a controlled group and decide if each member will report on their own or if the controlled group will report for all members Determine if employer member(s) will obtain third party filing assistance Determine if employer will report coverage based upon calendar months or weekly or payroll periods that approximate a calendar month Establish method to track coverage months for full-time employees Establish method to identify waiting periods during which new, full-time employees are not eligible for coverage Determine whether the lowest cost plan meets the 60% minimum value threshold Determine the employee s cost for self-only coverage for the lowest cost plan that provides minimum value Employer shared responsibility penalties are assessed at the individual controlled group level One member of the controlled group may file the section 6056 reports and statements on behalf of all members Each employer group will be liable for timely and accurate reporting. This corresponds with an employer using four (4) or five (5) consecutive weeks to determine full-time status under the monthly measurement period method and An employer using payroll periods for adjustments to measurement periods to coincide with payroll periods (see illustration attached) (see illustration attached) Note: A minimum value plan must be a legitimate offer for affordability measurement to be based upon their cost. Low plan, self-only coverage cost must be determined for each employee, regardless of their current coverage status (e.g. employee with spouse or family coverage in a higher value plan) Provided by: Next Generation Healthcare Economics Page 4

5 Determine if employer will use Federal Poverty Line affordability safe harbor Plan is deemed affordable if the employee cost for the lowest cost coverage option for self-only coverage that provides minimum value is no more than 9.5% of the U.S. Mainland federal poverty line. Create method for tracking coverage offered to each full-time employee on a monthly basis Create method for tracking reasons why coverage was not offered for each full-time employee on a monthly basis Employer plan sponsors will be required to report for each calendar month using a code whether minimum essential coverage meeting minimum value standards was offered to: The employee only The employee and their dependents only The employee and the employee s spouse only The employee, employee s spouse and dependents Coverage was offered to the employee for the month although the employee was not a full-time employee for that month; Employee was covered under the plan and the employer met one of the affordability safe harbors under H-5(e)(2) with respect to each applicable employee Employer plan sponsors will be required to report for each calendar month using a code whether minimum essential coverage meeting minimum value standards was NOT offered to the employee and whether: Any failure to offer coverage will not result in an assessment under section 4980H(a) or (b) because the employee was in a limited non-assessment period (e.g. measurement or waiting period); or for certain employees, as defined in (h)-1(a)(26); or o The employee was not a full-time employee; or o The employee was not employed by the employer plan sponsor during that month; or o No other code or exception applies Provided by: Next Generation Healthcare Economics Page 5

6 Obtain consent from individuals to electronically send 6055/6056 statements Determine if mid-sized employer is eligible for transitional relief from Employer Shared Responsibility assessments (penalties) Determine if employer is eligible for non-calendar year transitional relief from Employer Shared Responsibility assessments (penalties) for 2015 Consent may be obtained from employees on the same form used to obtain consent to provide Form W-2 electronically, as long as Form 1095 is specifically mentioned in the request and all conditions for electronic provision are met. The same request for consent for 6055 statements may be used to obtain consent for electronic delivery of 6056 statements. Employers with full-time and full-time equivalent employees may be eligible for transitional relief from assessments until If eligible for mid-sized employer transitional relief, employer must provide certification via form 1095-C. Employers subject to Employer Shared Responsibility assessments in 2015 that maintain a non-calendar year plan may be eligible for transitional relief from assessments for the months between 1/1/2015 and the first day of their plan year (Employers must still report for all of 2015) If eligible for transitional relief, employers must provide certification via form 1095-C. Determine if employer is eligible for simplified reporting To qualify for simplified reporting, an employer must certify on its form 1095-C that it offered to at least 98% of its employees minimum essential coverage providing minimum value that was affordable coverage (using one of the affordable safe harbors) The employer s 6056 report must list all employees, but does not have to indicate which ones are full-time. Provided by: Next Generation Healthcare Economics Page 6

7 Determine if alternative reporting is available for some employees or if employer must use form 1095-C Self-insured plan sponsors may be permitted to certify that they offer qualified coverage to one or more of their full-time employees and may report using a simplified section 6056 return for those employees: For one alternative method, the applicable large employer must certify that for all months during the year in which the employees were full-time employees with respect to which a section 4980H assessment could apply, the employer: o Offered minimum essential coverage providing minimum value at a cost for employee self-only coverage that does not exceed9.5% of the U.S. Mainland single federal poverty line to one or more of its full-time employees, and o Offered minimum essential coverage to the employees spouses and dependents. Note: While it is permissible to not offer spousal coverage, employers who do not may not use this alternative reporting method. Only for 2015 reporting, an employer may use another alternative method if it can: o o Certify that it has offered minimum essential coverage providing minimum value to its full-time employees and minimum essential coverage to the employees spouses and dependents, and In lieu of providing a form 1095-C to its employees, they employer may satisfy its section 6056 employee reporting requirement with respect to all of its full-time employees by providing a statement to each of its full-time employees by January 31 st of the year following the year to which the statements apply. Provided by: Next Generation Healthcare Economics Page 7

8 Employer must provide statements to individuals covered in their section 6056 report by January 31 st of each year (February 1 st for 2016) File form 1095-C with IRS by February 28 th (February 29 th for 2016) if by paper; by March 31 st if filing electronically (continues on next page) Use form 1095-C Use single statement for all employees; designating the number of months of coverage IRS may grant 30-day extension upon employer showing good cause Employer must provide statement to next of kind of deceased individuals in the year of their death Sending statement via first class mail to last known address discharges employer reporting obligation, even if the statement is returned Employer may provide statement electronically, if individual agrees The section 6056 portion of form 1095-C requires the following information: o Name, address and EIN number of the employer plan sponsor; o The calendar year for which the information is reported; o The name and telephone number of the employer plan s contact person; o A certification as to whether the employer offered to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan by calendar month; o The number of full-time employees for each calendar month during the calendar year, listed by calendar month o For each full-time employee, the employee s share of the lowest monthly premium for self-only coverage providing minimum value offered to each full-time employee by calendar month Provided by: Next Generation Healthcare Economics Page 8

9 File form 1095-C with IRS by February 28 th (February 29 th for 2016) if by paper; by March 31 st if filing electronically (continuing from prior page) (continued) The section 6056 portion of form 1095-C requires the following information: o The name, address and TIN of each full-time employee and the months the employee was covered under an eligible employer-sponsored health plan during the calendar year. The section 6056 portion of form 1095-C requires the provision of the following information using codes that indicate: o Whether the coverage offered to full-time employees and their dependents provides minimum value and whether the employee had the opportunity to enroll their spouse in the coverage; o The total number of employees, by calendar month o Whether an employee s effective date of coverage was affected by a permissible waiting period per section 4980H, by calendar month; o Whether the self-insured employer plan sponsor is a member of an aggregated group, determined under section 414(b), 414(c), 414(m) or 414(o) and, if applicable, the name and EIN of each employer member of the aggregated group making up the applicable large employer on any day of the calendar year for which the information is reported; o For governmental plans only: if a designated person is reporting on behalf of a self-insured employer plan sponsor that is a governmental unit or any agency thereof for purposes of section 6056 reporting, the name, address and TIN of the designated person; Provided by: Next Generation Healthcare Economics Page 9

10 File form 1095-C with IRS by February 28 th (February 29 th for 2016) if by paper; by March 31 st if filing electronically (continuing from prior page) Filing corrections to form 1095-Cs (continued) The section 6056 portion of form 1095-C requires the provision of the following information using codes that indicate: o For multi-employer plans only: if a self-insured employer plan sponsor is a contributing employer to a multiemployer plan, whether, with respect to a full-time employee, the employer is not subject to an assessable payment under section 4980H due to the employer s contributions to a multi-employer s plan in accordance with the requirements of a collectively bargained agreement; and if a third party is reporting for an employer plan sponsor with respect to the plan sponsor s full-time employees, the name, address and TIN of the third party (in addition to the name, address and EIN of the employer plan sponsor already required to report under the final regulations). If employer provides a no-cost, mandatory minimum essential coverage providing minimum value to all of its employees, the employer may use an indicator code on the form 1094-C transmittal to indicate that it offered this kind of coverage. Assessments (penalties) are reduced if a corrected return is filed within 30 days of the due date of the original return filing. Provided by: Next Generation Healthcare Economics Page 10

11 SAMPLE REPORTING TOOLS EXAMPLE OF COVERAGE REPORTING: SELF-INSURED HEALTH PLAN SAMPLE COMPANY: ABC, Inc. EIN: Year: 2015 Employee/Dependent(s) John Doe (employee) Amy Doe (dependent) Steven Doe (dependent) SSN(s) X X X X X X X X X X X X X X X X X X X X X X X X X X X X EMPLOYER REPORTING ON OFFER OF COVERAGE TO FULL-TIME EMPLOYEE SAMPLE COMPANY: ABC, Inc. EIN: Year: 2015 Employee/Dependent(s) Jane Smith (employee) SSN(s) G F F F B B B B B B B B X X X X X X X X CODES: A = MV coverage offered to employee only B = MV coverage offered to employee and dependents only C = MV coverage offered to employee and spouse only D = MV coverage offered to employee, spouse and dependents E = MV coverage not offered F = Waiting period G = Employee not full-time for the month or not employed for the month H = Employer not in business for the month X = $450, which is employee's share of lowest monthly premium for self-only coverage for employer coverage that offers MV Provided by: Next Generation Healthcare Economics Page 11

12 Notes: 1. This information applies only to self-insured health benefits plan sponsors. Different rules apply to health benefits plans provided by insurance companies or governmental plans (other than self-insured plans covering employees of a governmental entity). 2. Coverage that consists solely of excepted benefits such as stand-alone dental, vision or healthcare Flexible Spending Accounts (FSAs) are not subject to section 6055 or 6056 reporting. 3. Even though there are no penalties assessable to employers who do not provide spousal coverage, the IRS and Exchanges ( The Marketplace ) will need information indicating whether an employers offer of coverage to their full-time employees includes (or does not include) an offer of coverage to spouses. In cases where spouses are not offered coverage, and are not considered eligible for coverage under their spouse s employer s plan, the spouse may be eligible for a premium tax credit for coverage purchased through a public exchange. 4. Wellness programs that are an element of other minimum essential coverage plans (such as wellness programs offering reduced premiums or cost-sharing under a group health plan) do not require separate section 6055 or 6056 reporting. 5. Note that each participating employer for a self-insured group health benefits plan or a Multiple Employer Welfare Association (MEWA) is subject to section 6055 and 6056 reporting requirements. 6. These reporting requirements do not include Health Savings Accounts (HSAs), coverage that is not minimum essential coverage or on-site clinics. 7. Sections 6055 and 6056 information returns may be filed using Forms 1094-C and 1095-C or any other form(s) designated by the IRS. A substitute form may be used if it includes the required information and complies with IRS procedures or other guidance. Employers must also provide employees with a written statement, and can be provided by either providing the employee with a copy of form 1095-C or any other copy of a designated IRS form or a substitute statement, if it complies with IRS regulations. 8. For definition of employee see Employer s Supplement Tax Guide IRS Publication 15-A. 9. Disclaimer: This exhibit provides general information and is not to be construed as compliance or tax advice for any group, entity or individual. Provided by: Next Generation Healthcare Economics Page 12