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The Affordable Care Act: Are You in Compliance?

This time of year, many companies are arranging the renewal of their health plans.  As your company prepares to do the same, please keep one thing in mind: the Affordable Care Act (“ACA”).   

Below are a few of the topics discussed in our ACA seminar with Bernstein Shur Attorney, Steve Gerlach.


  • Beginning in 2015, employers with 100 or more full time employees (part-time employees are counted proportionally) are subject to ACA penalties if they fail to offer to their full time employees health coverage that meets ACA standards. These penalties run $2,080-3,120 per year per employee. 
  • Beginning in 2016, the same rule applies to employers with 50 or more full time employees.
  • Beginning in early 2016, employers with 50 or more full time employees must file forms 1095-C and 1094-C with the IRS and affected employees. The forms report on the health coverage offerings made by the employer in calendar year 2015.
  • Employers of all sizes are generally prohibited from paying for all or a portion of the cost for its employees’ individual policies. The IRS assesses a $100 per day per employee fine for violations. 
  • Employers of all sizes are generally prohibited from paying for all or a portion of the cost for its employees’ Medicare Part B, Medicare Part D, Medigap or Medicare Advantage premiums.
  • Cadillac Tax rules take effect in 2018. The Cadillac tax is a 40% tax on high-cost health insurance.  Employers with contracts (e.g., employment contracts, collective bargaining agreements) that may last into 2018 should consider now the effects of the Cadillac Tax will have on their health plans in 2018.  Employers who sponsor “rich” health plans should begin considering their options now and not delay their compliance efforts until 2018.  

It is our mission to always inform our clients on current tax-related laws.  Please be advised, however, that this is only a brief description of the ACA.  We believe it is very important that you have a general understanding of the law’s impact, but the ACA is an enormously complex law that cannot be summarized in a one-page letter.  We therefore strongly suggest that you begin the process of complying with the ACA now, and contact us with questions or concerns. 


Topics: Tax Laws, The Affordable Care Act