Just what is state-mandated ACA reporting all about?
If your company or organization is an Applicable Large Employer (ALE), as defined by the Affordable Care Act (ACA), then you are probably familiar with federal ACA reporting requirements. You also likely know about the Internal Revenue Service (IRS) Forms 1095 and 1094. What your company or organization may not be aware of is individual state legislative trending that requires ALEs to report ACA compliance with the employee’s state of residence — in addition to reporting to the IRS.
ACA is not going away – it’s expanding
States are moving toward employer legislative mandates to report ACA offers and coverage to protect, support and stabilize their healthcare marketplaces. The reporting data will help states identify individual taxpayers and employers who are failing to meet the minimum state health insurance requirements.
Much like the ACA federal penalties, states also stand to generate revenue by fining and penalizing individual taxpayers and employers for non-compliance. So far, six states have passed individual healthcare reporting mandates – New Jersey, the District of Columbia, Massachusetts, Rhode Island, California, and Vermont. Similarly, legislative actions are being considered for state-mandated ACA reporting legislation actions by Hawaii, Maryland, Connecticut and Minnesota.
Deadlines for States Currently Requiring ACA Reporting
|State||ACA Action||2019 State Reporting required?||Deadline|
|New Jersey||State-mandated that ALE’s are required to submit 1094 and 1095 passed May 2018 and went into effect January 1, 2019||Yes||March 31, 2020|
|District of Columbia||State-mandated that ALE’s are required to submit 1094 and 1095 passed June 2018 and went into effect January 1, 2019||Yes||June 30, 2020|
|California||State-mandated that ALE’s are required to submit 1094 and 1095 passed July 2018 and goes into effect January 1, 2020 – details for submissions are in draft form||No||March 30, 2021|
|Massachusetts||Massachusetts’ individual responsibility mandate went into effect in 2006, predating ACA, but reporting is limited to employer forms 1099-HC only||Yes||Unknown|
|Rhode Island||State-mandated that ALE’s are required to report coverage, but no details available. Passed July 2019 and goes into effect January 1, 2020||No||Unknown|
|Vermont||State-mandated that ALE’s are required to report coverage, but no details available. Passed May 2018 and goes into effect January 1, 2020||No||Unknown|
|Hawaii||Considering state healthcare individual mandate||No||N/A|
|Connecticut||Considering state healthcare individual mandate||No||N/A|
|Washington||Considering state healthcare individual mandate||No||N/A|
|Maryland||Considering state healthcare individual mandate||No||N/A|
What does state-mandated ACA reporting mean for employers?
If your company is an ALE and employs any full-time workers who reside in states with individual state mandates, your company must submit the required offer and coverage data to that state, and meet the minimum offer requirements, or face penalties. As each state determines what kind of data and how the data is to be submitted, employers must be ready to comply or accept the consequences.
If your company employs workers from multiple states with individual mandates, your company must follow each state’s requirements for ACA data submission. Some states have decided to accept the same data that is required by the IRS. Other states have limited their requirements to one single focus (1099-HC). Several states that have passed legislation have not yet decided what the requirements will be. To be certain, however, it will be the employer’s responsibility to comply with each state’s individual mandate. This could greatly complicate matters for employers and the information technology specialists who transmit data for them.
How will your company or organization handle both Federal and State reporting?
If you need help for both Federal and State reporting, consider ACA-Track™. ACA-Track is a flexible and proven solution to ACA tracking and reporting.
Questions? Just give us a call at 1.800.488.7395 or click here to schedule a free, no-obligation online demonstration.