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Understanding Health Care Reform

Employer Shared Responsiblity

Employer Shared Responsibility (ESR) is a provision within the ACA that states applicable large employers, defined as an employer with 50 or more full-time and full-time equivalent employees, may pay penalties if any full-time employee receives a premium tax credit or cost-sharing reduction when purchasing health coverage on the Marketplace.

Wellmark is committed to leading and assisting organizations through these changes by providing you with the tools and information necessary to make the best decisions about your employer-sponsored health plans.

Discussion Guide

The Play or Pay Discussion Guide asks the question of whether the math works to drop coverage and explain why it makes sense to do what a majority of employers do now, offer coverage to your employees.

 

Information Briefs
Wellmark has developed a series of information briefs, each targeting a specific requirement of ESR. Each brief provides an in-depth review of the requirement, its potential impact on businesses, examples, and next steps organizations can take to prepare.

 

Title Description
Applicable large Employer PDF

Employers with 50 or more full-time and full-time equivalent employee will be considered an applicable large employer subject to ESR requirements and potential penalties.  In this information brief, you will find:

  • How to calculate your applicable large employer status, with step-by-step instructions
  • The definition and calculation of a full-time equivalent employee
  • The seasonal worker exception
  • The impacts of being part of a controlled or affiliated service group

Applicable Large Employer – Worksheet PDF

Use this worksheet to calculate and determine if your organization is an applicable large employer with 50 or more full-time and full-time equivalent employees.

Affordability PDF

To avoid penalties, an applicable large employer must offer health coverage to its full-time employees that is affordable relative to the employee’s household income. In this information brief, you will find:

  • How the ACA defines affordability
  • The three safe harbors an employer can use to establish if coverage is affordable.

Minimum Value PDF

To avoid penalties, an applicable large employer must offer health coverage to its full-time employees and their dependents that meet the minimum value requirement of 60 percent. In this information brief, you will find:

  • The definition of minimum value
  • How funding accounts and wellness incentives affect minimum value
  • The four methods organizations can use to determine plan’s value.

Penalties PDF

Applicable large employers may pay penalties if any full-time employee receives a premium tax credit or cost-sharing reduction when purchasing health coverage on the Marketplace. In this information brief, you will find:

  • How to calculate the No Coverage Penalty
  • How to calculate the Inadequate Coverage Penalty
  • Several examples of calculating penalties

Determining Full-time Employee Status PDF

Penalty calculations are based on the number of full-time employees or the number of full-time employees receiving subsidized Marketplace coverage for a given month. This information brief will discuss how an employer can determine who is a full-time employee for purposes of offering coverage and penalty calculation. In this information brief, you will find:

  • The definition of a full time employee and dependent
  • What is considered an hour of service
  • A comparison of the monthly and look-back measurement methods
  • Examples of how the measurement methods work

Administrative and Reporting Requirements PDF

Coming Soon!

 

 

Webinar recordings

 

Series OrderTopicWebinar RecordingWebinar Presentation
1

Employer Shared Responsibility - Overview

Webinar Recording Video Presentation PDF
2

Determining Applicable Large Employer and Full-time Employee Status

Webinar Recording Video Presentation PDF
3

Minimum Value, Affordability, & Penalties 

Webinar Recording Video Presentation PDF
4

Final Rules Debrief

Webinar Recording Video Presentation PDF
5

Administrative & Reporting Requirements

Webinar Recording Video Presentation PDF

 

Federal Guidance

 

Employer Shared Responsibility Final Rules Leave Site

IRS Q&A on Employer Shared Responsibility Leave Site

IRC Section 6055 Information Reporting of Minimum Essential Coverage Leave Site

IRC Section 6056 Information Reporting by Applicable Large Employers on Health Insurance Coverage Offered by Employer Sponsored Plans Leave Site

 

 

Wellmark is not providing any legal advice with regard to compliance with the requirements of the Affordable Care Act ("ACA") and Mental Health Parity and Addiction Equity Act ("MHPAEA"). Regulations and guidance on specific provisions of the ACA and MHPAEA have been and will continue to be provided by the U.S. Department of Health and Human Services ("HHS") and/or other agencies. The information provided reflects Wellmark's understanding of the most current information and is subject to change without further notice. Please note that plan benefits, rates, renewal rate adjustments, and rating impact calculations are subject to change and may be revised during a plan’s rating period based on guidance and regulations issued by HHS or other agencies. Wellmark makes no representation as to the impact of plan changes on a plan's grandfathered status or interpretation or implementation of any other provisions of ACA or MHPAEA. Any questions about Wellmark's approach to the ACA or MHPAEA may be referred to your Wellmark account representative. Wellmark will not determine whether any change in an Employer Administered Funding Arrangement affects a health plan’s grandfathered health plan status under ACA or otherwise complies with ACA.  Wellmark will not be held liable for any penalties or other losses resulting from any Employer Administered Funding Arrangement. For purposes of this paragraph, an “Employer Administered Funding Arrangement” is an arrangement administered by an employer in which the employer contributes toward the member’s share of benefit costs (such as the member’s deductible, coinsurance, or copayments) in the absence of which the member would be financially responsible.  An Employer Administered Funding Arrangement does not include the employer’s contribution to health insurance premiums or rates.

 



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