The IRS recently released final versions of the forms that will be used by employers and insurers to report the health coverage information used to enforce the individual and employer mandates under Health Care Reform. The new forms will also be used to verify an individual’s eligibility for subsidies on the exchanges. For additional background information on these new reporting requirements, please see our prior HRBenefitsAuthority from March 31, 2014 and August 7, 2014.
Forms 1094-C and 1095-C. Forms 1094-C and 1095-C will be used by applicable large employer members (ALEMs) to report the detailed coverage information used to calculate employer mandate penalties and verify an individual’s eligibility for exchange subsidies. For ALEMs offering self-funded coverage, Form 1095-C will also be used to verify compliance with the individual mandate.
The instructions to the final Forms 1094-C and 1095-C include several important clarifications and changes from the draft version of the instructions. For example, the final instructions clarify that an ALEM may use Form 1095-C to report with respect to non-employees enrolled in self-funded coverage (e.g., retirees and COBRA beneficiaries). The draft instructions would have required the ALEM to use Forms 1094-B and 1095-B for non-employee participants. This change allows ALEMs to satisfy all of their reporting obligations using Forms 1094-C and 1095-C.
Forms 1094-B and 1095-B. Forms 1094-B and 1095-B are used to report enrollment information about individuals who are covered by minimum essential coverage and therefore satisfy the individual mandate. These forms will be used primarily by insurers (since companies with less than 50 to 100 employees usually maintain fully insured plans).
Reporting Deadlines. The first reports will be based on 2015 calendar year information and (i) must be furnished to employees and any non-employee participants no later than February 1, 2016, and (ii) must be filed with the IRS on or before March 31, 2016 (February 29, 2016 for paper filers).
No reporting is required for the 2014 calendar year. However, employers may use the final forms and instructions to voluntarily file in 2015 for the 2014 calendar year.
Next Steps. Employers will need to begin reviewing the final forms and instructions now to determine what information will need to be tracked during the 2015 calendar year for reporting in 2016. Employers will also need to develop a process for collecting this data and completing the required forms.