Large Groups Compliance Checklist

Large Employer 2016 ACA Compliance


The Affordable Care Act (ACA) has made significant changes to group health plans since the law was enacted over four years ago. Many of the key reforms became effective in 2014, including health plan design changes, increased wellness program incentives and reinsurance fees. Additional reforms took effect in 2015, including the shared responsibility penalty and reporting requirements. At Michigan Planners, Inc. we strive to provide you easy-to-understand communication materials regarding this crucial and complicated topic. Outlined here, we have provided you with a simple checklist of what you need to know regarding your benefit programs beginning in 2016.

  • COBRA Notices: Under COBRA, group health plans must give each covered employee (and the spouse) covered under the plan a general notice describing COBRA rights within the first 90 days of coverage. The updated model notice includes two new paragraphs referencing coverage options under the exchanges and special enrollment options, as well as a link to the Marketplace website. In addition, the election notice that is issued within 14 days of a qualifying event occurrence will also contain two additional pages regarding the Marketplace.
  • Cost Sharing Limits: Annual out-of-pocket maximum limits for 2016 are $6,850 single / $13,700 family. High deductible health plan annual out-of-pocket limits for 2016 are $6,550 single / $13,100 family.
  • Health FSA Contributions: Beginning in 2013, the ACA placed an annual limit on an employee’s pre-tax contributions to a health flexible spending account (FSA). Limits for 2016 have not yet been announced.
  • Health Savings Account Contributions: For the 2016 calendar year, the maximum single contribution into an H.S.A. account is $3,350 and the maximum family contribution is $6,750. Age 55+ catch-up contribution will remain at an additional $1,000.
  • Employer Shared Responsibility (Employer Mandate): Employers with 50 or more full-time equivalent employees (or FTEs) are required to offer affordable coverage that meets minimum value requirements to their full-time employees and their dependents, or pay tax penalties.
    • Less than 50 FTEs: No requirement to offer coverage.
    • 50-99 FTEs: Are not required to offer coverage until 2016 plan year, assuming they meet certain requirements.
    • 100 or more FTEs: Must offer coverage to 70 percent of full-time employees in 2015 (and any calendar months during 2015 plan year that fall in 2016), increasing to 95 percent in 2016 and beyond.
  • HIPAA Certification: Health plans that are considered a controlling health plan (CHP) are responsible for providing the initial HIPAA certification with HHS certifying their compliance with HIPAA’s electronic transaction standards and operating rules. Based on HHS’ definition of CHPs, an employer’s self-insured plan will likely qualify as a CHP. For fully-insured health plans, the health insurance carrier will likely be responsible for providing the certification. The certification deadline has been extended to December 31, 2015. Further guidance will be issued due to the indefinite delay of the HPID requirement.
  • Affordability of Coverage: Consideration of an affordable healthcare plan will adjust to 9.66% of the employee’s household income beginning in 2016. If an affordability safe harbor is used to measure a plan’s affordability, then 9.5% will be used to determine affordability (safe harbor includes: W-2 wages, rate of pay or federal poverty level).
  • Reporting of Coverage: The ACA requires ALEs to report information to the IRS and to employees regarding the employersponsored health coverage. The IRS will use the information reported to verify employer-sponsored coverage and administer the employer shared responsibility provisions. All ALEs must report under section 6056 for 2015. The first returns will be due in 2016 for health plan coverage provided in 2015.


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