The 2022 federal open enrollment period began earlier this week and will run through January 15, 2022. Consumers will have a wide variety of options to choose from, as well as reduced premiums.
According to a news release from the Centers of Medicare and Medicaid Services (CMS), there will be 213 participating insurers offering coverage for the 2022 plan year. That’s 32 more than the 2021 plan year. Thanks to the American Rescue Plan (ARP), “four out of five consumers will be able to find health care coverage for $10 or less per month with the extra savings made available under the ARP.”
A report issued by CMS cites that for the 2022 plan year, premiums will drop by 3% in the 33 states that operate off the federal healthcare.gov platform. The Kaiser Family Foundation (KFF) states that Americans obtaining coverage through the federal marketplace will on average, “have a choice of nearly 83 qualified health plans in 2022, compared to an average of 46 plans in 2021.”
The Biden administration has also provided an additional $80 million in funding to ACA navigators to help Americans decide on their healthcare for the 2022 plan year. Navigators help consumers evaluate their healthcare options, apply for Medicare/Medicaid, and qualify for ACA financial assistance, including Premium Tax Credits (PTC) and cost-sharing reductions.
To further assist consumers with healthcare, the administration has also launched one of the largest open-enrollment outreach programs ever.
It’s important to note that the changes first introduced via the ARP regarding affordability and PTC eligibility are still in effect for the 2022 plan year. Under the ARP, Americans with income up to 150% of the Federal Poverty Level (FPL) can receive silver quality health coverage for $0 monthly premiums.
In addition, Americans with incomes at 400% or beyond the FPL can obtain coverage through state and federal health exchanges for no more than 8.5% of their household income. It remains to be seen if these changes to subsidized healthcare will remain after 2022, though the administration is making strides to make it permanent.
The open enrollment period comes off the heels of the record-breaking federal special enrollment period and will surely garner some of the highest enrollment rates the ACA has ever seen.
With increased access to quality coverage through state and federal health exchanges, employers should be mindful of the increased allocation of PTCs. PTCs are the trigger for the IRS identifying ACA Employer Mandate non-compliance and thus could prove challenging for employers not offering adequate coverage to their full-time employees.
Under the ACA’s Employer Mandate, employers with 50 or more full-time employees and full-time equivalent employees are Applicable Large Employers (ALEs) and must:
- Offer Minimum Essential Coverage (MEC) to at least 95% of their full-time employees (and their dependents) whereby such coverage meets Minimum Value (MV); and
- Ensure that the coverage for the full-time employee is affordable based on one of the IRS-approved methods for calculating affordability.
ALEs that fail to meet these requirements could be subject to penalty assessments from the IRS under IRC Section 4980H.
With more PTCs abound and IRS enforcement ramping up, employers are encouraged to assess their ACA compliance processes now to protect themselves from IRS inquiries. Get a handle on ACA compliance by checking your ACA Vitals. This free tool will teach you about your organization’s potential ACA penalty exposure.
To learn more about ACA compliance and more specifically, how triggers like PTCs can impact employers, download the comprehensive 2021 ACA Essential Guide for Employers.
