As some readers know, I have been working on a guide to the Affordable Care Act for local government employers for the last year. That book manuscript was set to go to the printer on November 17th – the week after the presidential election. With the November 8th election of Donald Trump as President and of a majority-Republican United States Congress, the question naturally arises: what will happen to the Affordable Care Act? After all, both Mr. Trump and Republicans in Congress have vowed to repeal the ACA. Must employers still observe the ACA’s employer mandate and file information reports on compliance with the employer mandate with the IRS in 2017? For myself and for the School of Government, an additional question arose: should we proceed with the publication of a book about a law that may shortly be repealed? To learn more about what might happen to the ACA and when, and about how to access my book manuscript while the ACA is still in effect, read on.
Background: The ACA’s Employer Mandate
The ACA’s employer mandate requires that employers with 50 or more employees offer health insurance coverage to their full-time employees and their dependents or face substantial penalties. Employers who have fewer than 50 employees are not subject to the employer mandate.
The IRS knows which employers have satisfied the employer mandate from the information that employers, insurers and the healthcare exchanges must provide to the IRS every year through a complicated series of forms. Employers must provide these forms to each of their employees (these forms are something like the W-2 forms issued for income tax reporting purposes) and to the IRS. An employer must also provide the IRS with aggregate information about the offers of health coverage it has made. Self-insured employers (that is, those who have not entered into a contract for health insurance coverage for their employees with an insurance company, but who fund and administer their own health insurance coverage) must complete the IRS forms required of insurers, as well. The ACA requires these forms to be given to employees by the end of January of each year and filed with the IRS by the end of February or March, depending on whether the employer files electronically. The IRS has recently extended the deadline for providing Forms 1095-B and 1095-C to employees to March 2, 2017. It has not extended the deadlines for filing with the IRS. You can read IRS Notice 2016-70 extending the deadline here.
The Future of the Affordable Care Act
Mr. Trump and the Republican Congressional majority have vowed to repeal the ACA. While this may be their ultimate goal, already there have been reports that Mr. Trump has said he will keep certain parts of the Act and Paul Ryan, the Republican Speaker of the House, has been quoted as saying that Congress cannot repeal the ACA until it has something to put in its place. But I’ve also read that some House Republicans are determined to repeal the ACA as soon as the new Congress convenes in January. So how and when the ACA will be amended or repealed is anyone’s guess right now. For one discussion of the possibilities, see here.
I have no crystal ball. But it seems possible that the ACA, or parts of it, may be with us for some time as the new Administration and new Congress consider their options in healthcare reform. For that reason, local government employers with 50 or more employees should assume that by March 2, 2017 (the extended deadline), they will be required to give Form 1095-C reporting 2016 offers of health insurance coverage to each employee and that in February and March 2017, they will be required to file all Forms 1095-C, along with transmittal Forms 1094-C with the IRS. Self-insured employers with fewer than fifty employees should assume that they will be required to file Forms 1094-B and 1095-B in their roles as insurer.
Understanding the Employer Mandate and the Reporting Due This January: My Book is Available!
The School of Government has decided to hold off on printing paper copies of my book until the future of the ACA is clearer. Instead we will be making my book, A Guide to the Affordable Care Act for Local Government Employers, available online at a reduced rate in PDF form.
The book includes discussions of
- what it means for an employer’s health coverage to meet the ACA requirement that it be affordable, including discussions of the affordability safe harbors, as well as of how wellness program incentives, health reimbursement accounts, flexible spending accounts and opt-out offers affect affordability;
- the employer mandate penalties, as well as a discussion of the relationship between the employer mandate, the individual mandate and premium tax credits;
- how to count workers in order to determine whether an employer is covered by the ACA;
- how to use both the monthly measurement period and the look-back measurement period to determine which employees work an average of 30 hours per week and must therefore be offered health insurance coverage; and
- comprehensive instructions on how to complete IRS Forms 1094-C and 1095-C, with a special section on transitional relief for 2016. The book includes annotated copies the forms that must be filed for 2016.
The book is available at http://tinyurl.com/SOG-ACA