ACA Employer Compliance: Changes in 2017 Looming


Paper Stack

As 2016 winds to a close, employers should be careful not to let Affordable Care Act compliance fall by the wayside. 

In addition to implementation of new regulations, employers entering the second year of compliance with ACA reporting requirements won’t have some of the good faith and transitional relief that was available for 2015 reporting.  The following is a list of compliance issues employers should be aware of:

Good Faith: Employers that showed they made previous hitgood faithnext hit efforts to comply with the information reporting requirements weren’t subject to penalties for incorrect or incomplete information for 2015 returns. Good faith waivers will not be available for 2016 returns; instead employers will only be able to avoid penalties for compliance failures due to reasonable cause.    

Transitional Relief: The transition relief the IRS offered for 2015 won't exist for 2016, meaning all applicable large employers now have to offer coverage to 95 percent of full-time employees and dependents, instead of 70 percent.

Reporting Requirements: The IRS offered employers two months of relief for the first year they were required to provide health coverage forms to employees and the IRS. Thus far, 2016 returns maintain their original deadlines. Those who fail to file or furnish, or who file or furnish incorrect information returns, face an increased penalty of $260 per form, up from last year’s $250 per form.

IRS Form 2015 Deadline 2016 Deadline

Forms 1095-B and 1095-C (submitted to employees)

 March 31, 2016 Jan. 31, 2017

Forms 1094-B and 1094-C with copies of1095-B and 1095-C (submitted to the IRS by paper)

May 31, 2016 Feb. 28, 2017

Forms 1094-B and 1094-C with copies of 1095-B and 1095-C (submitted to the IRS electronically)

June 30, 2016 March 31, 2017


See related story, Employers get More Time to Fill out ACA Reporting Forms.

Taxpayer Identification Numbers: Employers that request missing enrollee TINs within 75 days of the account being opened will be treated as acting in a responsible manner, even if they don’t receive the TIN number. The account is considered opened on July 29, 2016, for individuals enrolled in coverage on any day before July 29, 2016, making this year’s deadline Oct. 12, 2016. 

Nondiscrimination: Plans have until the first day of the first plan year beginning on or after Jan. 1, 2017, to implement provisions that ban discrimination by any self-funded health plan that receives federal financial assistance or is administered by an executive agency. Section 1557 of the ACA prohibits discrimination on the basis of race, color, national origin, age, disability or sex, including discrimination based on pregnancy, gender identity and sex stereotyping in certain health programs and activities. 

Plans are also required to provide, free of charge, auxiliary aids and services to individuals with disabilities and language assistance services for individuals not proficient in English.

Wellness: Final rules amending both the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act on wellness plan incentives take effect on the first day of the first plan year beginning on or after Jan. 1, 2017. The final ADA rule (RIN:3046-AB01) and the final GINA rule (RIN:3046-AB02) detail how employers can offer inducements for wellness plan participation while ensuring they don't coerce employees or their covered spouses to submit to involuntary medical exams or to divulge genetic information, including family medical history.  Both rules allow employers to offer employees and their spouses incentives to encourage wellness plan participation that equal up to 30 percent of the total cost of self-only coverage.  See related story, EEOC: Wellness Plans Must Improve Health or Prevent Disease.  

Summary of Benefits and Coverage: Plan sponsors must begin using the new SBC materials and supporting documents on the first day of the first open enrollment period beginning on or after April 1, 2017. In April 2016, federal agencies finalized a new version of the summary of benefits and coverage and uniform glossary that health plans must provide consumers under the ACA.  See related story, Agencies revise ACA Summary of Benefits and Coverage.

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