This Affordable Care Act presentation covers common coverage misunderstandings, ACA reporting requirements, 4980h(a) penalty, Code 4980I, exchange notices and excise tax on high cost health plans.

1. The ACA:
What Could Go Wrong?
@Ellen_Feeney
#SHRM15

2. Major Potholes to Avoid and the Road Ahead
 Three Potholes to Avoid
– Notice of Coverage Options Misunderstandings
– IRS Reporting Requirements by Employer Size
– The Biggest Pothole of All – the 4980H(a) Penalty
 Two Stops on the Road Ahead
– Exchange Notices
– Excise Tax on High Cost Health Plans (Effective 2018)
1 © Copyright 2015 ADP, LLC.

3. 2 © Copyright 2015 ADP, LLC.
Pothole #1 – The Notice of Coverage Options
Provide to All New Hires (not just benefits-eligible)
Employers
Who Offer a
Health Plan:
Employers
Who Do Not Offer
a Health Plan:

4. Pothole #2 - IRS Employer Mandate Reporting
Applies to Employers with 50-99 Full-Time Employees
 Reporting required for all ALEs with 50+ full-time
employees
 Penalties apply if you have 100 or more employees
 Employers – regardless of size – that offer self-
insured plans must do Minimum Essential
Coverage Reporting
3 © Copyright 2015 ADP, LLC.

5. 4 © Copyright 2015 ADP, LLC.
New IRS Forms
Are You Ready for Employer Mandate Reporting?
Form 1094-C to the IRS
 Filing electronically (>250 Forms 1095-C)
by March 31 of the next year
 Filing paper (<250 Forms 1095-C)
by February 28 of the next year
Form 1095-C to IRS, Full-Time Employees
and COBRA Participants and Retirees
 Mail paper forms to last known address
or electronic delivery (with consent)
 By January 31 of the next year
 First filing in 2016 for 2015 information

6. Form Penalties
 Penalties up to $100/Form 1095-C
may apply for missing/incorrect
taxpayer identification numbers, late
filing, incorrect media, incorrect
format, etc., up to $1.5 million.
 No penalties in 2015 for missing or
incorrect information for employers
that demonstrate a good faith effort
to comply.
5 © Copyright 2015 ADP, LLC.

7. 6 © Copyright 2015 ADP, LLC.
Pothole #3
Perhaps, the Biggest Pothole of All. . . .
 Not offering coverage to at least 70% of full-time
employees and being subject to Section 4980H(a)
penalty!
– $2,000 times the number of full-time employees
– For 2016 and after, an Offer of Health Coverage must
be made to at least 95% of full-time employees

8. Stop #1 on the Road Ahead
Employer Exchange Notices
7 © Copyright 2015 ADP, LLC.
 The Exchange must notify the employer
when an employee is deemed eligible
for a premium tax credit and provide the
employer the right to appeal
 Most state exchanges and the FFE are
not yet sending notices
 Are you prepared to respond?

9. State Health Insurance Marketplace Types
8 © Copyright 2015 ADP, LLC.

10. 9 © Copyright 2015 ADP, LLC.
Stop #2 on the Road Ahead
Excise Tax Penalty (Effective 2018)
Have you calculated your penalty risk? Most plans will be effected.
Employer is responsible for calculating.

11. 10 © Copyright 2015 ADP, LLC.
Thank You and Stay Tuned
To ADP’s Eye on Washington regulatory email alerts visit:
www.adp.com/eyeonwashington
Please visit www.adp.com/acafaqs for a list of ACA
Frequently Asked Questions or www.adp.com/health-care-
reform for additional ACA insights.
Before taking any actions on the information contained in this presentation, employers and plan sponsors should review this material with internal
This material is subject to change and is provided for informational purposes only and nothing contained herein should be taken as legal opinion, legal advice, or a comprehensive compliance
review. The ADP Logo, ADP, ADP Research Institute, and In the Business of Your Success are registered trademarks of ADP, LLC. All other trademarks and service marks are the property of
their respective owners. Copyright © 2015 ADP, LLC. ALL RIGHTS RESERVED.
@Ellen_Feeney
#SHRM15