The ACA is not as dead as many people seem to think. With all the talk of repeal and replace and the end of various provisions, it’s easy to think that the ACA is irrelevant – but that’s not exactly true. Although some key changes have been made, much of the law still stands, and employers can and do continue to receive penalties for failing to follow the employer mandate.

The Individual Versus the Employer Mandate

Some confusion may stem from incorrectly mixing the individual and employer mandates.

The individual mandate requires individuals who can afford to buy health insurance to do so. However, the fee used to enforce the individual mandate was repealed as part of the Tax Cuts and Jobs Acts. As MarketWatch points out, this change won’t go into effect until 2019, and people may still see penalties taken out of tax refunds in the meantime.

Even then, it may not have a huge effect on the average person’s decision to buy health insurance. According to analysis from the Associated Press and Avalere Health, the ACA marketplace is actually stabilizing. For 2019, it looks like there will be no counties without an insurer, and in many states, premiums are expected to rise only slightly or even drop.

The employer mandate is a separate issue. It requires employers to provide affordable insurance that provides minimum value. Applicable large employers must provide insurance to at least 95 percent of their full-time employees and their dependents.

As of right now, the employer mandate has not been repealed, although some have expressed interest in doing so. H.R. 4616, which was introduced in the House in December 2017, would suspend the employer mandate until 2019 if passed.

Employer Mandate Penalties

The penalties for shirking the employer mandate can be quite hefty. According to the IRS, the possible penalties for 2018, adjusted for inflation, are $2,320 and $3,480 per employee.

The Congressional Budget Office estimated that employers would pay a total of $139 billion in penalties between 2015 and 2024.

Although penalty notices have been slow to manifest, companies have been receiving them. According to Accounting Today, the IRS has sent out more than 30,000 penalty assessment notices since November 2017, when the first notices regarding 2015 were sent out. Now the IRS has started working on penalty notices regarding 2016. Enforcement is continuing, and if anything, the government is getting better at identifying non-compliant companies.

The employer mandate may still be repealed. However, unless and until that happens, the employer mandate remains the law of the land, and companies that don’t comply can expect to face significant penalties.

Tune in next week, to learn more about the upcoming ACA reporting requirements for employers. Travisoft solutions help you stay ACA-compliant. Request a demo to learn more.