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Your Bank > Education and Advice > CNB University

Employer Health Insurance Rules Eased for 2015

Margaret Meyer
Margaret M. Whelehan
Vice President, Financial Advisor
(585) 899-4653 x

Health insurance remains a big focus for employers of all sizes as the Affordable Care Act’s provisions are gradually implemented. Starting next year, certain employers will have to offer their full-time employees “affordable” health coverage that provides “minimum value” or pay a penalty if at least one full-time employee enrolls in marketplace coverage and receives a premium tax credit (basically a subsidy for buying the insurance).

The employer shared responsibility rules are applicable only to “large” employers — generally defined in the law as employers that employed on average at least 50 full-time or full-time equivalent employees on business days during the prior calendar year. An employee is a full-time employee for a calendar month if the employee averages at least 30 hours of service per week, and 130 hours of service in a calendar month is treated as the monthly equivalent of at least 30 hours of service per week.

Although the employer shared responsibility rules become effective in 2015, the IRS recently offered certain transition relief for 2015:

Employers with 50-99 full-time employees. 

No employer shared responsibility payment will apply during 2015 if an employer has at least 50 but fewer than 100 full-time employees (including full-time equivalents) on business days during 2014 if certain conditions are met. The basic conditions: During the period from February 9, 2014, through December 14, 2014, the employer must not (1) reduce the size of its work force and overall hours of service of its employees in order to qualify for the relief or (2) eliminate or materially reduce the health coverage, if any, it offered as of February 9, 2014.

Counting full-time employees. 

Employers can determine whether they had at least 100 full-time or full-time equivalent employees in the prior year by reference to a period of at least six consecutive months instead of a full year.


Employers that are subject to the employer shared responsibility provisions in 2015 must offer coverage to at least 70% of full-time employees, rather than 95%, as one of the conditions for avoiding shared responsibility payments. Additionally, the policy that employers offer coverage to their full-time employees’ dependents will not apply in 2015 to employers that are taking steps to arrange for dependent coverage to begin in 2016.


Source: Newkirk. All rights reserved. This material provided by Margaret Meyer.