Affordable Care Act (ACA) – Limits, Fees and Penalties Through 2019
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Article Summary
The Affordable Care Act (ACA) contains a number of limits and penalties that apply to employers. These include the following provisions: Employer Shared Responsibility - (employer mandate) – requirement that applicable large employers (ALEs) offer affordable, minimum value coverage to substantially all full-time employees and their dependents.
The Affordable Care Act (ACA) contains a number of limits and penalties that apply to employers. These include the following provisions:
Employer Shared Responsibility (Employer Mandate)
Requirement that applicable large employers (ALEs) offer affordable, minimum value coverage to substantially all full-time employees and their dependents.
- Affordability - an offer is affordable if the employee’s contribution, toward the employee only rate, does not exceed a certain percentage of their compensation. Employers use one of the three allowable safe harbor compensation methods to determine affordability, e.g. W-2, rate of pay, or federal poverty line (FPL).
| Plan Years | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|
| Affordability Safe Harbor Percentages | 9.86% | 9.56% | 9.69% | 9.66% | 9.56% | 9.50% |
- Penalties - for failure to comply with the Employer Shared Responsibility provision.
- Tier 1- Failure to offer to substantially all full-time employees.
- Tier 2- Failure to provide coverage that is affordable or meets minimum value (plan reimburses at least 60% of the cost of essential health benefits).
| Employer Mandate Penalties – Calendar Year | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 |
| Tier one: Failure to offer coverage or to offer to 95% of employees (70% for 2015) | $2,500 | $2,320 | $2,260 | $2,160 | $2,080 | $2,000 |
| Tier two: Failure to offer coverage that is affordable and meets minimum value | $3,750 | $3,480 | $3,390 | $3,240 | $3,120 | $3,000 |
Market Rules
- Flexible Spending Accounts - The maximum amount of annual pretax dollars employees may put aside through payroll deduction to pay for qualified medical expenses.
- Health Savings Account (HSA) - An employee-owned bank account coupled with a qualified high deductible plan.
Listed below are the new limits, fees and penalties along with historical perspective.
| Account Limits | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 |
| Health Care Flexible Spending Account (FSA) | $2,700 | $2,650 | $2,600 | $2,550 | $2,550 | $2,500 |
| Dependent Care Flexible Spending Account (FSA) | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 |
| Health Spending Accounts (HSA) | ||||||
| High Deductible Health Plan Annual Deductible Minimums | Self-only: $1,350 Family: $2,700 | Self-only: $1,350 Family: $2,700 | Self-only: $1,300 Family: $2,600 | Self-only: $1,300 Family: $2,600 | Self-only: $1,300 Family: $2,600 | Self-only: $1,250 Family: $2,500 |
| Annual Out-of-Pocket Maximums | Self-only: $6,750 Family: $13,500 | Self-only: $6,650 Family: $13,300 | Self-only: $6,550 Family: $13,100 | Self-only: $6,550 Family: $13,100 | Self-only: $6,450 Family: $12,900 | Self-only: $6,350 Family: $12,700 |
| Maximum Contribution | Self-only: $3,500 Family: $7,000 | Self-only: $3,450 Family: $6,850/ $6,900 | Self-only: $3,400 Family: $6,750 | Self-only: $3,350 Family: $6,750 | Self-only: $3,350 Family: $6,650 | Self-only: $3,330 Family: $6,550 |
| Transportation Fringe Benefits | ||||||
| Parking | $265/mo | $260/mo | $255/mo | $255/mo | $250/mo | $250/mo |
| Mass transit | $265/mo | $260/mo | $255/mo | $255/mo | $250/mo | $130/mo |
| Fees – Paid by Health Plan – Per Covered Life | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 |
| Transitional Reinsurance Fee | n/a | n/a | $0 | $27.00 | $44.00 | $63.00 |
| Patient-Centered Outcomes Research (PCORI) | ||||||
| Plan years ending 1/1 - 9/30 | $2.45 | $2.39 | $2.26 | $2.17 | $2.08 | $2.00 |
| Plan years ending 10/1 - 12/31 | n/a | $2.45 | $2.39 | $2.26 | $2.17 | $2.08 |
To stay up to date on the latest compliance news, updates and changes in regulation, visit the ACA Watch page or contact your OneDigital Consultant.