Reporting Requirements
Summary
PPACA adds several new reporting requirements for employers that sponsor group health insurance plans. Those include the Form W-2 reporting requirement, informational reporting requirements and the quality of care reporting requirement.
Specifically, in 2013 employers began reporting the cost of employer-sponsored coverage on an employee's Form W-2. In addition, there are certain employer informational reporting requirements in conjunction with the implementation of PPACA's individual and employer mandates. Finally, non-grandfathered plans are subject to a quality of care reporting requirement, whereby the plan reports on whether plan or coverage benefits satisfy certain criteria related to the cost and quality of health care. There is no specific guidance or effective date for the quality of care reporting requirement.
Learn more about the W-2 reporting requirement.
Learn more about the informational reporting requirements.
Learn more about the quality of care reporting requirement.
Recent Developments
With respect to Form W-2 reporting, there have been no recent developments. The requirement went into effect for Forms W-2 distributed in 2013, and remains in effect going forward.
With respect to informational reporting, on March 10, 2014, the IRS issued final regulations on the information reporting requirements under 6055 and 6056. On February 4, 2015, the IRS published the final versions of the 6055 and 6056 reporting forms, as well as the final instructions for those draft forms. With respect to quality of care reporting, there are no recent developments. Until the federal agencies issue additional guidance, this requirement is not in effect.
Employer Action Required
On the Form W-2 reporting requirement, employers that file 250 or more Forms W-2 are subject to the W-2 reporting requirement, which was effective for 2012 Form W-2 reporting (i.e., those Forms W-2 that were due in January 2013). Employers must continue to evaluate whether they have filed 250 or more Forms W-2 in the previous calendar year in order to determine if the Form W-2 reporting requirement will continue to apply to them. If so, employers should review their obligations under the requirement, determine which coverages must be included in the reporting, and calculate the appropriate amounts that must be reported on each employee's Form W-2.
On the informational reporting requirement, self-insured plans and large employers (those with 50 or more full-time employees (FTEs), including full-time equivalent employees), regardless of grandfathered status, must report certain health insurance coverage information to the IRS. There are two separate reporting and employee statement requirements found in two separate sections of the IRC: 6055 and 6056. Section 6055 applies to all employers that sponsor self-insured plans and Section 6056 applies to all employers subject to the employer mandate. Employers subject to both 6055 and 6056 (i.e., those with 50 or more FTEs, including equivalents) that sponsor self-insured plans may combine their reporting.
In addition, under Sections 6055 and 6056, self-insured plans and large employers (described above) must provide a written statement to a covered individual that summarizes the IRS report on an individualized basis. Affected employers should review their obligations under the requirement, review their plan information and prepare for compliance. The first reports are due in 2016, reporting on 2015 compliance.
There is no specific effective date for the annual quality of care reporting requirement (although it was expected to be effective in 2013), and the federal agencies have not yet issued guidance on this requirement. Thus, for now, employers need not concern themselves with this reporting requirement.
Penalties for Noncompliance
On the Form W-2 reporting requirement, failure to properly report the cost of employer-sponsored health coverage may result in a $30 to $100 penalty per Form W-2.
On the informational reporting requirement, failure to properly report may result in a penalty of up to $100 per failure.
On the quality of care reporting, there are no specific penalties at this time. Future guidance addressing this requirement will likely address potential penalties for noncompliance.
Additional Resources
W-2 Reporting Requirement
Informational Reporting Requirements
Quality of Care Reporting
- At this time, there are no official government resources available on this requirement.
Citations
- PPACA §9002(b); IRS Notice 2012-9
- IRC §§5000A, 6055, 6056; IRS Notices 2012-32 and 2012-33
- PHSA §2717, as added by PPACA, Pub. L. No. 111-148 (2010)
- 79 Fed. Reg. 13220, 13231 (Mar. 10, 2014)
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