Beginning in 2015, employers with 50+ full-time employees or full-time equivalents must offer medical coverage that is "affordable" and provides minimum value to full-time employees and their children up to age 26 or face penalties.
Coverage is “affordable” if employee contributions are less than 9.5% of:
- Employee's W-2 wages
- Employee’s monthly wages (hourly rate x 130 hours per month),
- Federal Poverty Level for a single individual
A plan must pay 60% of the cost of covered health services to provide "minimum value." The minimum value calculator is available online.
This chart summarizes the coverage requirements and the penalties that apply if any full-time employee purchases coverage on an exchange and receives a federal premium assistance tax credit. The penalties will be adjusted in future years.