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Employer Healthcare Reform Reports Simplified in New Rule Proposal

Joe Mont | September 9, 2013

The Treasury Department and the Internal Revenue Service have issued proposed reporting rules for what will be required of insurers and employers under the Affordable Care Act. 

The rules are part of the employer mandate of the Affordable Care Act, a requirement that businesses with 50 or more employees offer their full-time personnel health insurance or be monetarily penalized. The rules under review were delayed, and reconsidered, after the Obama Administration announced it would push the effective date of employer mandate requirements up a year, from 2014 to 215.

The proposed rules describe a variety of options that may reduce or streamline reporting requirements, among them:

  • Allowing employers to report employee healthcare information on traditional W-2 tax forms, rather than the separate forms detailed in the legislation (Section 6056 employee statements).
  • Eliminating the need to determine whether particular employees are full-time if adequate coverage is offered to all potentially full-time employees.
  • Allowing employers to report the specific cost to an employee for purchasing employer-sponsored coverage only if the cost is above a to-be-specified dollar amount.
  • Allowing self-insured group health plans to avoid furnishing two separate employee statements detailed in the legislation (Section 6055 and Section 6056) and allowing, instead, a single substitute statement.
  • Allowing health insurance issuers to forgo reporting on individual coverage offered through a Marketplace, a redundancy because that information will already be provided directly by the Marketplace.
  • Permitting health insurance issuers and employers to forgo reporting the specific dates of coverage (instead reporting only the months of coverage), the amount of any cost-sharing reductions, or the portion of the premium paid by an employer.

The proposed rules do still require employers and insurers to report other data detailed in the legislation, including:

  • Information about the entity providing coverage, including contact information.
  • A list of individuals, with identifying information, and the months they were covered.
  • A list of full-time employees and information about the coverage offered to each, including the cost of self-only coverage.

Public comment will be accepted until early November, with that feedback taken into account in developing final reporting rules. Once the final rules have been published, covered entities are encouraged by the IRS and Treasury to voluntarily begin reporting in 2014, in preparation for the full application of the reporting provisions the following year. 

“Real-world testing of reporting systems will contribute to a smoother transition to full implementation,” a statement from the agencies says.