As most employers know, a large part of the Affordable Care Act (ACA) was the standardized definition of affordable health coverage for employees. This definition, otherwise known as the employer mandate, set a percentage of an employee’s household income that their health care coverage contribution cannot exceed. When fully implemented, employers that did not offer affordable plans to employees are subject to penalties.
As with a number of provisions in the ACA, the employer mandate was delayed at least a year (depending on company size). News came out from the Internal Revenue Service (IRS) recently that the maximum employee contribution percentage will increase from 9.5% to 9.56% as the mandate starts to be phased in.
In a related move, the IRS also adjusted the individual mandate (threshold of household income that cannot be exceeded for a plan to be considered affordable) from 8% to 8.05%.
As a reminder, here is the current timetable for employer mandate:
Employers with 100+ employees:
- Must offer affordable health plans to at least 70% of full-time employees by 1/1/15;
- Must offer affordable health plans to at least 95% of full-time employees by 1/1/16.
Employers with 50-99 employees:
- Must offer affordable health plans to at least 95% of full-time employees by 1/1/16.
If you are an employer that falls into one of these categories (most importantly 100+ employers), we’d advise you to ensure that the percentage change doesn’t impact your compliance with the employer mandate.
As always, if you have any ACA-related questions or concerns, you are always welcome to reach out to us and get answers from our health care experts.

Teri Weber

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