More Compliance
Once a company reaches 50 full-time equivalent workers, the ACA treats it as an applicable large employer. From that point it owes the IRS yearly filings and must give employees their own coverage statements.
Growth adds obligations.
Crossing the 50 full-time-equivalent line makes an employer an applicable large employer under the ACA, with annual information returns to the IRS and statements to employees. Larger plans also face filing and notice requirements under ERISA.
A broker who keeps a compliance calendar means these deadlines are tracked before they arrive.
What Crossing 50 Changes.
Crossing the 50 full-time-equivalent line brings the ACA employer mandate into view. Large employers must offer coverage, report on it and meet affordability and minimum-value standards, or risk penalties.
It can also change rating, funding options and the carrier pool. Many employers revisit their strategy as they approach the line.
Counting uses a look-back method with hours-based rules. Seasonal and controlled-group rules can change the answer, so confirm with your adviser.
A few more questions.
Who determines if we are an ALE?
The employer, using a full-time-equivalent count over the prior year. Your broker or advisor can walk you through it.
Is this legal advice?
No. Confirm specifics with your attorney or tax advisor.
How do we count full-time equivalents?
Add full-time employees to part-time hours divided by a set amount. The IRS rules are specific.
When should we start planning?
Before you cross the line, since the first year of obligation can be hard.
What penalties apply?
The ACA includes penalties for not offering coverage or for unaffordable coverage. Confirm current rules.
Related guides.
Health Insurance Broker for Mid-Size Michigan Employers
What growing Michigan employers should expect.
Claims Data Matters
A group of this scale often has enough claims history that insurers weigh it when setting a price. Putting that history to work in negotiations is a core broker responsibility.
Contribution Strategy
Decisions about the employer share, and about how it is divided between employee-only and family tiers and among plan options, drive both what the company spends and how workers feel about the package.
Where the Rules Come From.
Each law or regulation mentioned above links to its source text. Treat this page as background reading rather than legal or tax advice; requirements shift, so confirm against the current wording.
ERISA (29 U.S.C. Chapter 18)
The federal law that sets reporting, disclosure and fiduciary rules for employer-sponsored benefit plans.
Affordable Care Act (Pub. L. 111-148)
Establishes much of the framework for employer-sponsored coverage, including market-wide protections and the filing obligations placed on employers.
ACA Employer Reporting (26 U.S.C. 6056)
Employers that meet the large-employer threshold send the IRS a return describing the coverage they made available, and hand each employee a matching statement.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
An independent employee benefits consulting firm. We look at the entire benefits program: cost, plan performance, risk and administration.
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