The first set of final regulations – addressing Section 6055 reporting – applies to all entities providing minimum essential coverage (“MEC”) and requires them to report healthcare coverage information to the IRS, as well as, provide a statement to all covered individuals. Entities subject to this requirement include health insurance issuers and employers sponsoring self-insured health plans. The second set of final regulations – covering Section 6056 reporting – applies to applicable large employers, which are generally employers with 50 or more full-time and full-time equivalent employees. These applicable large employers (“ALEs”) must report health care coverage information to the IRS and provide each full-time employee with a statement containing the same information as the IRS report. Both reporting requirements are important because they function as key elements in administering PPACA’s Individual and Employer Mandates. Section 6055 reporting is needed for enforcement of the Individual Mandate (which remains effective for 2018); Section 6056 is needed for enforcement of the Employer Mandate. Note that the legislation from 2017 that repealed the penalty provision did not actually repeal the section of PPACA that imposes the penalty. Importantly, other provisions of PPACA, such as IRS reporting and furnishing of statements to impacted individuals under Section 6055 (i.e., reports of the months that an individual has coverage), remain in effect. In addition, the penalties associated with failure to report or furnish statements to individuals also remain in effect.
The IRS released final 2018 Forms and Instructions for Forms 1094-B, 1094-C, 1095-B, and 1095-C to comply with Sections 6055 and 6056 in September and October 2018. This article is updated to include materials from those final Instructions and Forms and additional guidance.
Roadmap to this Article:
If you are an employer sponsoring a self-insured health plan, then Section 6055 reporting is relevant to you. If you are an applicable large employer with a fully insured health plan, you may skip to the Section 6056 reporting because your carrier will be responsible for providing the Section 6055 reporting. If you are a self-insured, applicable large employer, please enjoy the entire article.