In 2014, PPACA will enable employees to access premium credits to purchase insurance on a state exchange if their employer does not offer health coverage or offers a health benefit that does not meet a 60 percent actuarial value threshold. Employers are subject to penalties when employees access the subsidies.

Minimum Value

The IRS has asked employers to provide feedback on minimum value. The IRS notice describes three potential approaches to establishing minimum value:

  • A calculator created by the federal government that would allow employers to enter information about a plan’s benefits and cost sharing terms to determine whether the plan meets the minimum actuarial value as benchmarked by typical self-funded and employer plans.
  • A handful of “safe harbors” that are defined by checklists that would allow plans to determine compliance without the need to perform calculations or hire an actuary;
  • An actuarial certification.

Reporting Requirements

The IRS has also issued two notices here and here requesting comments on how they will collect plan and enrollee information from employers for the 2014 plan year with reporting effective in 2015. The reporting is intended to provide a measure of compliance with employer responsibility requirements and to help employees and the IRS determine whether the individual has “minimum essential coverage” for the purposes of the individual mandate.

The stated purpose of the IRS request for feedback is to minimize administrative burden and duplication between two PPACA reporting provisions and the separate W-2 reporting requirements. Seven specific questions for employers and health plans begin on page 4 of Notice 2012-32, including questions specific to self-funded plans.

How to Submit Comments

If you want to provide feedback on the above notices you may submit it to the IRS via email to Notice.Comments@irscounsel.treas.gov by June 11. Respondents should include the notice number (2012-31, 2012-32 or 2012-33) in the subject line.

The Alliance has directly advocated for administrative clarity, simplicity and common sense solutions at the federal level, and we work through strategic partnerships, including The National Business Coalition on Health and the American Benefits Council, to strengthen the voice of employers.