Reporting Requirements for Employers and Health Plans

The Affordable Care Act (ACA) created a number of federal reporting requirements for employers and health plans. The additional reporting is intended to promote transparency with respect to health plan coverage and costs. It will also provide the government with information to administer other ACA mandates, such as the large employer shared responsibility penalty and the individual mandate.

This Legislative Brief provides a summary of the following reporting provisions:

 

ACA Reporting Requirements for Employers and Health Plans

• Form W-2 reporting-CURRENTLY EFFECTIVE
• Applicable large employer health coverage reporting (Code § 6056)-delayed until 2015.
•  Reporting of health coverage by health insurance issuers and sponsors of self-insured plans (Code § 6055)-delayed until 2015.
• Transparency in coverage reporting and cost-sharing disclosures-delayed until at least 2015.
• Quality of care reporting-delayed, TBD

 

Form W-2 Reporting—currently effective

ACA requires employers to report the aggregate cost of employer-sponsored group health plan coverage on their employees’ Forms W-2. The purpose of the Form W-2 reporting requirement is to provide information to employees regarding how much their health coverage costs.

In general, all employers that provide “applicable employer-sponsored coverage” must comply with the Form W-2 reporting requirement. Applicable employer-sponsored coverage is, with respect to an employee, coverage under any group health plan made available to the employee by the employer which is excludable from the employee’s gross income under Code section 106.

The Form W-2 reporting requirement is optional for small employers for 2012 and 2013. Small employers will continue to be exempt from the reporting requirement for later years, unless and until the IRS issues further guidance. An employer is considered a small employer if it had to file fewer than 250 Forms W-2 for the prior calendar year.

Large employers (those that file 250 or more Forms W-2) were required to comply with the reporting requirement beginning in 2012 for the Forms W-2 that were due by the end of January 2013.