With the future of the Affordable Care Act in the hands of the federal court system, some states are enacting their own versions of the federal health care law’s individual mandate. These states are also implementing employer reporting requirements to assist them in enforcement efforts.
Effective in the 2019 calendar year, both the State of New Jersey and the District of Columbia have enacted individual mandates, requiring residents of those states to maintain certain health insurance coverage or face a penalty. For companies that have employees who are residents of these states, the related employer reporting requirements apply regardless of corporate location.
Sponsors of employment-based health plans could be subject to new state reporting requirements if they meet the following criteria:
New Jersey Employers
- Your company is an applicable large employer (i.e. averaged 50 or more full-time employees including full-time equivalents during the previous calendar year) and/or has federal employer reporting responsibility to file Forms 1094 and 1095 (either “B” or “C” forms); and
- Your company employed at least one person who was eligible for group health insurance coverage and was a resident of NJ
District of Columbia Employers
- Your company offers a Minimum Essential Coverage group health plan that covered at least fifty full-time employees; and
- Your company employed at least one person who was eligible for that group health plan and was a resident of DC
If your company meets these criteria, you will be required to file with the State regardless of the number of forms submitted, meaning there is no minimum filing threshold. There are also no paper filing options so all forms must be submitted to the states electronically.
Some payroll and Affordable Care Act service providers are not supporting the state electronic filing requirements for 2019. It is important that you contact your provider to confirm that these filings will be completed on your behalf.
The NJ forms are due March 31, 2020 and the DC forms are due June 30, 2020 (effective for the 2020 filing year, the DC forms will be due 30 days after the federal forms filing deadline including extensions.) Beginning in calendar year 2020, California, Rhode Island, and Vermont have enacted similar individual mandates that will likely result in additional reporting requirements for companies that have employees who are residents of those states.
Also note that Massachusetts enacted a state individual mandate that has been in effect since 2007. Along with that mandate comes an employer reporting requirement to file form 1099-HC if you offer a self-insured medical plan. Some MA employers must also report on plans offered to employees through the Health Insurance Responsibility Disclosure (HIRD) form utilizing the MassTaxConnect web portal.
For more information about these state employer reporting requirements:
We are actively working with our clients to ensure that these new compliance obligations are being addressed. If your health insurance broker is not supporting your Affordable Care Act compliance needs, please contact us for a consultation.