In just the past year, we’ve seen wholesale Obamacare changes, like the delay of the employer mandate and the Cadillac Tax, as well as the death of the automatic enrollment provision. But there have also been a number of minor tweaks that weren’t as highly publicized.  

Just because these ACA changes haven’t been met with the same fanfare as a lot of the major reg overhauls doesn’t mean HR pros don’t need to know about them.

Inflation adjustments

Here are two minor health reform changes:

Inflation adjustments for the affordability safe harbor percentages. Under the ACA, the threshold for determining whether a health plan is “affordable” to an employee is “9.5% of household income.” In other words, the cost of coverage cannot exceed this amount. But the law provides for inflation adjustments of this percentage.

So for plan years beginning in 2016, the 9.5% of household income threshold has been adjusted for inflation and becomes 9.66%.

Penalty increases. In the same way the safe harbor penalties have been adjusted for inflation, so too have the ACA noncompliance penalties. Initially, applicable large employers that don’t offer coverage to at least 95% (70% in 2015) of their full-time employees would be subject to a $2,000 per-employee penalty (minus the first 80 employees in 2015 and the first 30 employees thereafter). In addition, employers that offer unaffordable coverage would be hit with a $3,000 per-employee penalty for each worker who obtained coverage on an exchange.

Due to a premium adjustment percentage for inflation, the IRS announced in Notice 2015-87 that the penalty amount jumps to $2,080 for the 2015 plan year and $2,160 in 2016.

The $3,000 per employee penalty also gets bumped up to $3,120 for 2015 plan year and $3,240 for 2016.

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