The Affordable Care Act (ACA), or Health Care Reform law, is federal legislation passed in 2010. This new law is complex, multi-faceted and has an impact on both employers and individuals. A number of the rules and regulations relating to ACA compliance have not yet been issued or finalized.
Nothing in the ACA requires an employer to provide medical coverage to any employee. However, under the employer mandate provisions of the ACA, large employers, such as the University, that do not offer compliant medical coverage to ACA full-time employees, and their dependents, may have to pay a penalty to the government. There are special rules for determining an employee’s full-time status for purposes of the ACA and the requirement to cover dependents does not require coverage of the spouse of any ACA full-time employee.
On July 2, 2013, the U.S. Department of Treasury announced a delay in the Affordable Care Act’s reporting requirements until 2015 which will also delay the enforcement of the employer mandate. See: IRS Official Guidance on Delay of Employer Mandate.
In order to avoid potential penalties, the University will need to offer medical coverage to its ACA full-time employees, beginning with the 2015 plan year that is both “affordable” and provides “minimum value.” Coverage is “affordable” if your cost for employee-only coverage under the lowest-value plan offered by the University is no more than 9.5% of your family income. Coverage provides “minimum value” if the plan’s share of the total cost of allowed benefits is at least 60 percent.
The law also requires most Americans to have medical coverage beginning January 1, 2014. People who do not have coverage beginning in 2014 may have to pay additional taxes. If you are not eligible for benefits from the University, you should explore other coverage options, such as coverage through a program offered to your spouse or even through a parent’s plan.
Beginning October 1, 2013, individual policies will be available through state and federally operated health insurance exchanges – now called the Insurance Marketplace. Some individuals may qualify for premium and cost-sharing reductions if they purchase medical coverage through the Insurance Marketplace.
Individuals have the option of purchasing coverage under a qualified health plan offered in the Insurance Marketplace. You can access information about the ACA and the Insurance Marketplace at https://www.healthcare.gov.
The University does not contribute anything toward the cost if you purchase coverage under a Marketplace qualified health plan. However, you may be eligible for assistance in paying for Marketplace coverage, depending upon a number of factors, including your household income and whether you were offered employer coverage that meets certain requirements, such as “affordability” and “minimum value.”
You can also access information about the ACA by visiting the State of Delaware’s website. The State has announced the qualified health plans and rates for the Delaware Insurance Marketplace. For more information, visit: http://www.udel.edu/001886.
The ACA requires that you have medical coverage by January 1, 2014. As an employee of the University, you were provided with a Notice advising whether or not you are currently eligible for medical coverage through the University and providing you with information about the Insurance Marketplace.
If you are currently eligible for benefits from the University, waived medical coverage during the 2013 open enrollment period and do not have medical coverage from another source, like your spouse’s or parent’s plan, the University medical plan may be your best option for coverage. You’ll want to pay special attention to the annual enrollment period in 2014 when you’ll learn more about your medical coverage choices.
How much do my benefits through the University really cost?
On your pay stub, you will see the University’s benefits contribution shown as Flex Credit UDollars under Hours and Earnings. You will also see the full Before-Tax Deductions for Medical, Dental, Vision Care, Employee Life and Long-Term Disability.
When reviewing my pay stub, how do I determine my benefit out-of-pocket costs?
To calculate your out-of pocket cost, subtract the Flex Credit-UDollars from the Before-Tax Deductions to get your cost per pay. If your deductions are greater than the Flex Credit-UDollars, you are paying the difference with a pre-tax contribution. If the Flex Credit-UDollars amount is greater than the pre-tax deductions, you are receiving the difference in your taxable income. Note: This does not apply to civil unions. If a civil union spouse or dependent child is a non-tax qualified dependent, deductions taken for the named dependent(s) are taken after tax. Please also see your Flex Benefits webview for a summary of your deductions and University contributions.