Is Your Business Ready for the ACA Employer Mandate in 2015?
By: Christina Merhar (Zane Benefits) November 2014
With 2015 right around the corner, employers and their brokers are assessing how the Affordable Care Act (ACA) employer mandate impacts their healthcare offerings, and their bottom line. Under this provision, some U.S. employers will pay a fee for not offering health insurance. Is your business ready for the employer mandate? Here’s a short quiz to find out.
Question 1: Who Does the Employer Mandate Apply To?
A. All U.S. employers
B. Only U.S. employers with over 250 full-time equivalent employees
C. Only U.S. employers with over 100 full-time equivalent employees
D. Only U.S. employers with over 50 full-time equivalent employees
Answer:
D. The employer mandate only applies to U.S. employers with over 50 full-time equivalent (FTE) employees. And, there is some transition relief for employers with 50-99 FTE employees (read more about the transition relief here).
Question 2: When Does the Employer Mandate Start?
A. January 1, 2014 (it is already in effect)
B. January 1, 2015
C. January 1, 2016
D. Never – the employer mandate has been repealed
Answer:
B. The employer mandate starts January 1, 2015. However, as we mentioned in Question 1, transition relief is available to employers with 50-99 FTE employees for 2015. While there has been some political buzz about repealing the employer mandate, at the time of writing it is still going into effect in 2015.
Question 3: What “Triggers” the Fee?
The employer mandate fee (aka the Employer Shared Responsibility Fee) is triggered for applicable employers when:
A. The employer does not provide minimum essential, affordable health insurance
B. The employer does not provide minimum essential, affordable health insurance, and an employee buys individual insurance and receives a premium tax credit or subsidy
C. The employer does not provide minimum essential health insurance
Answer:
B. The fee is triggered when employers with more than 50 FTE employees do not provide minimum, affordable coverage, and an employee buys individual insurance and receives a premium tax credit or subsidy.
Question 4: How Much is the Fee for Not Providing Health Insurance in 2015?
The calculation for the monthly fee in 2015 is:
A. (# of Full Time Employees – 80) x $167
B. (# of Full Time Employees – 30) x $167
C. (# of Full Time Employees – 80) x $250
D. (# of Full Time Employees – 30) x $250
Answer:
A. For 2015, the Employer Mandate Fee is equal to the number of full-time employees the employer employed for the month (minus 80) multiplied by 1/12 of $2,000 ($167), provided that at least one full-time employee receives a premium tax credit/subsidy for that month.
There is also a fee if the employer offers minimum health insurance coverage, but it is not affordable. Read more: Calculating Employer Shared Responsibility Fees in 2015
