Question: Our company recently grew to
become an applicable large employer (ALE) under the Affordable Care
Act (ACA). As the ACA remains in effect for the time being, could
we get a refresher on what health care coverage must be offered to
our employees?
Answer: Of course. There are two types
of penalties under the employer shared responsibility provisions of
Internal Revenue Code Section 4980H — also known as the
ACA's "play or pay" provision. What health coverage
must be offered depends on the type of penalty.
Each penalty may be triggered if a full-time employee buys
coverage on a Health Insurance Marketplace (also known as an
"exchange") and receives premium tax credits. And only an
ALE may be subject to penalties. As you're no doubt aware, an
ALE is generally an employer that employed 50 or more full-time
employees, including full-time equivalents, during the previous
calendar year.
