The Internal Revenue Service has updated the affordability percentage under the Affordable Care Act (ACA) for 2023, according to a report by Jackson Lewis P.C. published on JDSupra.
Under the ACA, applicable large employers (ALEs) — those with, on average, fifty or more full-time or full-time-equivalent employees in the preceding year — are obliged to offer affordable, minimum value group health plan coverage to their full-time employees and those employees’ dependents in the following year to avoid imposition of ACA penalties.
Crucially, affordability is determined using the employee’s premium for the lowest-cost employee-only coverage under the employer’s scheme. The update promises to have broad-reaching implications for employers who must remain attentive to these changes to avoid penalty risks.
While the full details of the Revenue Procedure 2023-29 are not currently accessible, legal professionals within corporations and large law firms are advised to monitor new updates closely, as they will serve as important guidelines for maintaining compliance with ACA mandates. Vulnerability to sanctions can be mitigated by aligning with these guidelines and adopting appropriate health care strategies.
For thorough understanding and analysis of these changes, the revenue procedure details, when available, should become essential reading for compliance professionals and legal advisors responsible for reacting to legislative change within their organizations.