ACA New Reporting Requirements

Did You Know…

Part of the Affordable Care Act added Sections 6055/6056 to the Internal Revenue Code which places new reporting requirements on some employers?

If you have a self-insured health plan or have at least 50 full-time employees or fifty full-time equivalent employees you need to file information returns to the IRS beginning in 2016 for 2015 regarding health insurance coverage offerings (a full-time employee generally includes any employee who was employed on average at least 30 hours of service per week).

Section 6055 and 6056 require insurance providers, including insurance carriers, plan sponsors of self-insured group health plan coverage, government agencies offering government sponsored coverage and applicable large employers to file information returns with the IRS and provide statements to their full-time employees about the health insurance coverage offered.

What are the requirements of Section 6055?

A provider is defined as “Any person that provides minimum essential coverage to an individual must report to the IRS and furnish statements to individuals.”

The specific information that a provider must report to the IRS includes the following:

  • The name, address, and employer identification number (EIN) of the provider;
  • The responsible individual’s name, address, and taxpayer identification number (TIN), or date of birth if a TIN is not available.  If the responsible individual is not enrolled in the coverage, providers may, but are not required to, report the TIN of the responsible individual;
  • The name and TIN, or date of birth if a TIN is not available, of each individual covered under the policy or program and the months for which the individual was enrolled in coverage and entitled to receive benefits; and
  • For coverage provided by a health insurance issuer through a group health plan, the name, address, and EIN of the employer sponsoring the plan and whether the coverage is a qualified health plan enrolled in through the Small Business Health Options Program (SHOP) and (except for 2014 coverage reported in 2015) the SHOP’s  identifier.

What are the requirements of Section 6056?

Companies that meet the definition of an Applicable Large Employer (ALE) must provide the following information for calendar year 2015 to the IRS:

  • The name, address, and employer identification number of the ALE, and the calendar year for which the information is reported;
  • The name and telephone number of the ALE’s contact person;
  • A certification as to whether the ALE offered to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan, by calendar month;
  • The number of full-time employees for each calendar month during the calendar year, by calendar month;
  • For each full-time employee, the months during the calendar year for which minimum essential coverage under the plan was available;
  • For each full-time employee, the employee's share of the lowest cost monthly premium for self-only coverage providing minimum value offered to that full-time employee under an eligible employer-sponsored plan, by calendar month; and
  • The name, address, and taxpayer identification number of each full-time employee during the calendar year and the months, if any, during which the employee was covered under an eligible employer-sponsored plan. i

Additionally, an ALE must furnish a written statement to each full-time employee showing:

  • The name, address, and EIN of the ALE
  • The information required to be shown on the section 6056 return with respect to the full-time employee (and his or her spouse and dependents) ii

An ALE member must file a Form 1095-C (or other form the IRS designates, or a substitute form) for each of its full-time employees, and a transmittal on Form 1094-C (or any other form the IRS designates, or a substitute form) for all of the returns filed for a given calendar year. These forms must be filed with the IRS on or before February 28 (March 31 if filed electronically) of the year immediately following the calendar year for which the offer of coverage information is reported.  Because transition relief applies for section 6056 reporting for 2014, the first section 6056 returns required to be filed are for the 2015 calendar year and must be filed no later than February 29, 2016, or March 31, 2016, if filed electronically.

Avoiding Disaster

HR One can help you understand the requirements, whether your organization would be defined as a large employer under the provisions of the section and what information you’re required to collect, and when to file the information with the IRS.

If you have questions about how this can impact your organization, call HR One's Human Resource Helpline at 1.800.457.8829. We have tools for you to make this process less painful.

Additional Information:  You can also review more information on Section 6055 and Section 6056 requirements on the IRS website of the Internal Revenue Service

i https://www.federalregister.gov/articles/2014/03/10/2014-05050/information-reporting-by-applicable-large-employers-on-health-insurance-coverage-offered-under

ii http://www.irs.gov/uac/Questions-and-Answers-on-Reporting-of-Offers-of-Health-Insurance-Coverage-by-Employers-Section-6056