ACA proposed regulations on minimum value, premium tax credits help employers with health plan duties for 2014

HRS Insight

The IRS has issued proposed regulations under the Affordable Care Act (ACA) that will help employers to determine, disclose and report whether their health plans provide ‘minimum value’ to participants. Individuals who are eligible for ‘affordable’ coverage under an employer-sponsored plan that provides minimum value are not eligible for premium tax credits to buy insurance on exchanges (also newly dubbed ‘the Marketplace’). Conversely, employers offering health coverage that is unaffordable or not providing minimum value could be subject to penalty taxes if an employee obtains premium tax credits to buy insurance on an exchange. The regulations address the effect of health reimbursement arrangements (HRAs), health savings accounts (HSAs) and wellness program incentives, as well as retiree coverage, on minimum value and affordability. Employers must disclose whether their health plans provide minimum value in employee notices due October 1, 2013, and in Summaries of Benefits and Coverage, and will likely need to report on 2014 plan minimum value to the government.



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