Employers’ Continuing Affordable Care Act Obligations Under the Trump Administration

Category: Blog Posts
Date: Jan 24, 2017 03:12 PM
Employers’ Continuing Affordable Care Act Obligations Under the Trump Administration

One of the first acts of the new Administration was to issue an Executive Order (the “Order”) “Minimizing the Economic Burden of the Patient Protection and Pending Repeal.”  The Executive Order, which is in line with the President’s campaign platform to repeal and replace the Patient Protection and Affordable Care Act (ACA), provides:

“It is the policy of my Administration to seek prompt repeal of the [ACA] (the “Act”).  In the meantime, pending such repeal, it is imperative for the executive branch to ensure that the law is being efficiently implemented, take all actions consistent with law to minimize the unwarranted economic and regulatory burdens of the Act, and prepare to afford the States more flexibility and control to create  a more free and open healthcare market.” 

The Order directs the Secretary of Health and Human Services (the “Secretary”) and all other executive agencies heads with authority and responsibilities under the ACA, to exercise their legally conferred authority to grant waivers, deferrals, and exemptions to the ACA, and to delay implementation of ACA provisions that would have the effect of imposing “fiscal” burdens on States, individuals, families, healthcare providers, insurers, patients, recipients of health care services, and manufacturers of medical products.  The Order defines “fiscal burden” to include costs, fees, taxes, penalties or regulatory burdens.  Furthermore, the Order directs the Secretary and other agency heads, to the extent permitted by law, to grant flexibility to States in implementing their healthcare programs. 

While the Order does not repeal or replace the ACA, as doing so must be done by Congress, the Order essentially directs those executive agency heads, who have the responsibility of implementing the ACA, to use their authority to waive or delay implementation of certain provisions.

The Administration’s Order does not currently limit an employer’s responsibility to file ACA Reporting forms for the 2016 tax year.  As we previously published in our November Client Update article, Applicable large employers (ALEs) (those with 50 or more full –time employees, including full-time equivalent employees, in the previous year) must file 2016 Forms 1094-C and 1095-C, which report to the IRS information related to the ACA’s shared responsibility provisions.  Additionally, small employers with self-insured plans must file2016 1095-B forms with the IRS.     Employers have until February 28, 2017, if not filing electronically, or March 31, 2017, if filing electronically, to submit Forms 1095-B, 1094-C or 1095-C to the IRS.    

Employers must also furnish to individuals copies of the 2016 Form 1095-B or 1095-C.  These forms must be furnished to individuals by March 2, 2017. 

It is unclear whether the Administration will, moving forward, continue to enforce certain provisions of the ACA, including the IRS reporting requirements under the employer shared responsibility provisions.  We will continue to update you if and when the Administration issues further guidance.   For the time being, employers are strongly encouraged to comply with the reporting requirements, or risk being assessed penalties.   

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