Employers Must Stay in Compliance with The ACA Mandate
In a recent U.S. Supreme Court decision, California Et Al. V. Texas Et Al. decided on June 17, 2021, the Supreme Court rejected the challenge by Texas and a number of other states, to the Patient Protection and Affordable Care Act’s (ACA) individual mandate, based on the reduction of the individual mandate penalty’s reduction to zero, which became effective in 2019.
In this case, the Supreme Court was asked to decide whether the reduction in the penalty to zero, rendered the minimum coverage provision of the ACA unconstitutional and if so, whether the rest of the ACA could still be enforced without such provision.
Before considering the merits of Texas’ and the other states’ claims, the Supreme Court had to consider whether the Plaintiff’s had any standing to challenge the ACA. The Supreme Court held that none of the states had legal standing to sue on the matter as they were unable to demonstrate that the injury they would suffer or had allegedly already suffered is “fairly traceable” to the unlawful conduct they are complaining of.
This marks the third time that the Supreme Court has upheld the ACA. This ruling affirms that employers must continue to ensure that they are in compliance with all components of the ACA and be mindful of their shared responsibility and reporting requirements.
Employers with fifty or more full-time employees are subject to the regulations of the ACA. These employers must continue to file forms 1095-C and 1094-C each year and offer group health insurance to at least 95% of their qualifying employees or pay a penalty fee.
Employers must also maintain health plans designed to provide the claims procedures and benefit mandates required under the ACA such as the Mental Health Parity and Addiction Equity Act, the new disclosure requirements following the enactment of the Consolidated Appropriations Act, 2021, and the other additional new mandated procedures and coverage requirements under the act.
It is important that employers invest resources into maintaining compliance with the ACA and being prepared for audits. They must be sure that their employees are properly classified as full-time in accordance with the ACA. Under the ACA a full-time employee is one who works an average of at least 30 hours per week.
Employers should watch closely for regulatory changes and developments related to their group health plans. We know this area of the law is complex and convoluted. Our firm is here to help with your employment law matters as well as any corporate, commercial, and family law issues. We offer both in-person and virtual consults, please feel free to call our office at 305-460-0145 to schedule a consultation.