The Affordable Care Act, or ACA, continues to be scaled back as we progress into 2019, raising many questions about changes to the law. Read on to find out what you need to know as an employer, to comply with the ACA in 2019:
Are you legally required to offer your employees health benefits?
If you’re an ‘applicable large employer’ (Otherwise known as ALE), then you’ll still be legally required to provide a certain percentage of your full-time equivalent employees, or FTE’s, with minimum essential coverage, (otherwise known as MEC).
ALE’s are defined in 2019 as businesses that employed a combination of 50 or more full-time equivalent staff members throughout six months or more of 2018.
Must you pay a certain percentage of your employee’s health insurance premiums?
In 2019, if you own a small business with less than 50 full-time equivalent employees, then you’re not legally required to pay a certain percentage of their group health insurance premiums. That said, if you wish to qualify for the ‘Small Business Health Care Tax Credit’, then as an employer, you must pay at least 50% of the annual premiums for employees group health coverage.
With the QSEHRA or integrated HRA, as a small business you’ll face no minimum contribution requirements.
What about waiting periods?
If you’re a small business owner offering a group health insurance policy, QSEHRA or group coverage HRA, then you can institute a waiting period for benefit eligibility in 2019, but these cannot go over a 90 days period.
What employee disclosure rules will be applicable in 2019?
If as a small business, you offer your employees a group health policy, QSEHRA or integrated HRA, then you must also provide your workers with a standard Summary of Benefits and Coverage, or SBC form. These forms give further details of what is covered by their health benefits, and any associated costs. If you offer your employees a QSEHRA, then you are also required to send a QSEHRA notice to them annually, giving them access to information about their benefit total for the year, instructions as to what they must do if they’re applying for a premium tax credit, and details of tax penalties they may face if they fail to maintain MEC during the year.
What will be your small business reporting requirements in 2019?
The ACA mandates that you must withhold and report an extra 0.9% on employee wages or compensation that exceeds $200,000.
If you offer your workforce group health insurance, then you must report the value of the insurance coverage you’ve given to them all on their Form W-2, box 12 using code DD.
If you offer your employees a QSEHRA, then you are legally obliged to report the total tax-free payments and reimbursements given to each worker on their W-2, box 12 using code FF. You are also required to report all taxable reimbursements made through the QSEHRA as other compensation in box 1, Wages, Tips and Other Compensation.
For more detailed advice and guidance on your health insurance requirements as a small business owner in 2019, reach out to your local professional payroll specialist.