One critical aspect is to make arrangements with payroll/HR information systems providers and ensure the necessary information is being captured to meet reporting requirements on the front end.
Appleton, WI (PRWEB) January 27, 2015
A third party administrator (TPA) serving all 50 states, Cypress Benefit Administrators is helping employers understand the shared responsibility (pay or play) requirements within the Affordable Care Act (ACA) now that they have taken effect for plan years beginning on or after January 1, 2015.
The TPA has issued a helpful summary review that details the two types of penalties for non-compliance, employer reporting responsibilities and IRS-issued documentation.
“We’ve been receiving a lot of inquiries related to pay or play requirements since the start of 2015 and wanted to provide a quick resource that hit on the major points,” said Tom Doney, Cypress president and CEO.
“Employers want to make sure they have a clear understanding of the language and are adhering to all of the specifics,” he said. “One critical aspect is to make arrangements with payroll/HR information systems providers and ensure the necessary information is being captured to meet reporting requirements on the front end.”
The summary review from Cypress includes a breakdown of the two penalty types related to pay or play and compliance requirements:
- $2,000 annual penalty, Section 6055 – Applies to large employers that fail to offer at least 70% of full time employees (FTEs) health coverage for plan years beginning on or after January 1, 2015 (95% for January 1, 2016). The fee is based on number of FTEs after applying the applicable formula.
- $3,000 annual penalty, Section 6056 – Applies to large employers where (a) the offered coverage does not meet minimum value and affordability requirements and (b) one or more employees has received an exchange subsidy for insurance purchased on the Marketplace Exchange. The fee is based on number of FTEs affected.
Additionally, the refresher piece Cypress has provided includes information on reporting as it relates to pay or play. Along with links to draft versions of reporting Forms 1094-C and 1095-C are IRS-issued FAQs on Sections 6055 and 6056.
“As with all regulations that apply to the employee benefits industry, we will keep a close watch on how the pay or play requirements and resulting penalties unfold,” Doney said. “Cypress has always been a TPA that is committed to keeping our employer-clients in the know.”
A privately held company headquartered in Appleton, Wis., Cypress Benefit Administrators has been pioneering the way toward cost containment in self-funded health benefits since 2000. The third party administrator (TPA) is the country’s first to bring claims administration, consumer driven health plans and proven cost control measures together into one package for companies ranging from 50 employees to thousands of employees. It serves employer-clients across the U.S. with additional locations in Portland and Salem, Ore., Omaha, Neb. and Denver, Col. For more information on Cypress and its customized employee benefits, visit http://www.cypressbenefit.com.