About this BlogWelcome to the Snell & Wilmer Benefits Blog. We will be posting about current employee benefits and executive compensation topics and issues. We invite you to contact the authors with your thoughts or questions.
When Anything Less than 95% is a Failing Grade: An Update on the Employer Shared Responsibility Penalties
As a reminder, effective January 1, 2016, employers must offer minimum essential coverage to 95% or more (up from 70% or more for 2015) of their full-time employees and their dependents each month or pay a very steep penalty. Missing the mark even slightly, for example coming in at 94%, will require the employer to pay a $2,000 annual penalty for each full-time employee (minus the first 30 full-time employees).
The rules are explained in more detail in our Health Care Reform’s Employer Shared Responsibility Penalties: A Checklist for Employers, which I have updated to reflect certain recent guidance. Most importantly the revised Checklist:
- now reflects how the penalties are adjusted each year (see footnote 7 of the Checklist for more information);
- the $2,000 subsection (a) penalty is $2,080 for 2015 and $2,160 for 2016.
Share this Article: