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  • ACA to Aid Millions in Obtaining Healthcare, KFF Report Finds

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ACA to Aid Millions in Obtaining Healthcare, KFF Report Finds

September 4, 2020 Robert Sheen Affordable Care Act, Health Care Coverage
ACA to Aid Millions in Obtaining Healthcare, KFF Report Finds

2 minute read:

The data is in: at least 27 million Americans have lost employer-sponsored health coverage as a result of COVID-19.

The Kaiser Family Foundation issued a report in late May identifying 27 million Americans as having lost their employer-sponsored healthcare. Individuals that have lost their coverage will have a number of options for obtaining new coverage, including Medicaid, the ACA Marketplace (state or federal health exchange,) employer-sponsored insurance through a dependent, COBRA, or short-term plans.

The majority of those Americans will probably obtain coverage through either Medicaid or the ACA Marketplace. That same KFF report identified 79% of Americans who lost their jobs due to COVID-19-related factors as being “likely eligible for subsidized coverage, either through Medicaid (12.7 million) or through the ACA’s marketplaces (8.4 million).”

Of the nearly 13 million potentially eligible for Medicaid, individuals will have a more affordable option if their home state was one of the majority to have expanded Medicaid.

To date, 37 states and the District of Columbia have expanded Medicaid. For the 14 remaining states that have not adopted the ACA’s Medicaid expansion, roughly 4.4 million uninsured nonelderly adults could become eligible for Medicaid if these states elected to expand their programs, according to another study by the Kaiser Family Foundation.

The remaining eight million and counting will apply for a Premium Tax Credit through either a state or federal health exchange. Some of these individuals may wrongfully receive the government subsidy, as a recent TIGTA report finds. Whether they correctly receive the subsidy or not, the onus will be on employers to maintain accurate records as they gear up to file their 1094-C and employee 1095-Cs with the IRS next year.

Without detailed record keeping and an accurate ACA filing, employers could potentially expose themselves to significant ACA penalties.

As a reminder, PTCs are the trigger for the IRS issuing Letter 226J penalty notices to employers identified as having failed to comply with the ACA’s Employer Mandate for a specific tax year.

If an individual wrongfully receives a PTC, the burden falls on the employer not only to have accurate ACA compliance and reporting processes in place, but also to prove to the IRS that the individual did not qualify. For those who correctly received the PTC, it is important that employers code the employee’s 1095-C correctly to prove why the PTC should not result in a corresponding penalty.

The IRS is currently issuing Letter 226J penalty notices for the 2017 tax year, and is expected to begin penalties for the 2018 tax year sometime in 2020. With employees losing coverage from their employers, penalties are likely to be on the rise as a result. Make sure your organization isn’t exposed to these penalty notices with ACA Complete.

To learn more about ACA compliance in 2021, click here.


We’re committed to helping companies reduce risk, avoid penalties, and achieve 100% ACA compliance. For questions about the ACA contact us here.

Summary
ACA to Aid Millions in Obtaining Healthcare, KFF Report Finds
Article Name
ACA to Aid Millions in Obtaining Healthcare, KFF Report Finds
Description
A report from the Kaiser Family Foundation identified 27 million Americans as having lost employer-sponsored health coverage. Data shows they will turn to the ACA.
Author
Robert Sheen
Publisher Name
The ACA Times
Publisher Logo
The ACA Times
Short URL of this page: https://acatimes.com/nlx
Robert Sheen

Robert Sheen

Robert Sheen, Esq., is editor-in-chief of The ACA Times. He also is founder, president and CEO of Trusaic.

Robert Sheen is Founder and President of Trusaic, Inc. Robert is a graduate of the University of Southern California, in Business Administration with an emphasis in International Finance. He earned his Juris Doctor from Loyola Law School, Los Angeles, concentrating in Tax Law.

View more by Robert Sheen

Related tags to article

1094-C1095-CACA CompleteACA ComplianceACA Employer MandateACA PenaltiesACA ReportingAffordable Care ActApplicable Large EmployersCOBRACOVID-19Health Care CoverageHealth Insurance MarketplaceIRC Section 4980H PenaltiesIRSIRS Letter 226JKaiser Family Foundation (KFF)MedicaidMinimum Essential Coverage (MEC)Minimum Value (MV)Premium Tax Credit (PTC)Treasury Inspector General for Tax Administration (TIGTA)
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