What Changes Are Coming For ACA In 2021:Proposed Changes Announced By The New Administration
The new administration has announced its intention to pursue a number of changes to the Affordable Care Act (ACA). It’s not clear how these changes will be implemented via legislation or executive order. It’s also not clear how these changes will affect employers payroll reporting at both the state and federal level.
Changes to the Affordable Care Act
With the growing concern that as many as 30 million American’s may have lost their coverage due to the pandemic and the open enrollment deadline of December 15th behind us, there is still hope to enroll in coverage for 2021. A special open enrollment period for 2021 was passed to allow those without coverage to enroll from February 15th to May 15th. The expanded enrollment period will allow individuals to purchase coverage through the ACA Marketplace.
While the order applies only to the federal HealthCare.gov site, the order also encouraged the 14 states that manage their marketplace to follow suit and open enrollment for the same period. So far, California, Colorado, New Jersey, Pennsylvania, and Washington have announced their intention to reopen enrollment, and it is anticipated that other states will likely reopen.
While the enrollment period for American’s to obtain coverage has changed, the deadlines for businesses to file their Form 1095-C and Form 1095-B with the IRS remain the same: February 28th, if filing by paper, and March 31st, if filing electronically.
The Individual Mandate
Intentions to bring back the penalty for not having health insurance coverage is also being considered. The individual mandate was eliminated in 2017. The individual mandate requires individuals to have medical insurance either through employers, private insurance, or through the federal marketplace.
Currently, several states have implemented an individual mandate which requires employer reporting to state agencies. It is not certain how restoring the federal mandate will affect state compliance and reporting.
Other Proposed Changes To ACA In 2021
The new plan would lower the spending threshold for medical insurance to 8.5% of an individual’s income. Currently, the spending limit is 9.83%.
Under the proposed plan, Medicare would be able to negotiate prescription prices, limit prices “for all brand, biotech and abusively priced generic drugs”, and set prices for drugs with no competition.
Finally, the plan would allow undocumented immigrants to buy into the federal marketplace, but it would not be subsidized.
It’s clear that there will be many changes coming, and they will likely impact employers reporting requirements at both the federal and state levels. Aatrix will continue to monitor all changes and will keep our customers informed and ensure compliance with any reporting changes that occur.