Under the Affordable Care Act's employer shared responsibility provisions, an applicable large employer must take which action to avoid owing a shared-responsibility assessment to the IRS?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under the Affordable Care Act's employer shared responsibility provisions, an applicable large employer must offer its full-time employees and their dependents health coverage that qualifies as minimum essential coverage, is affordable for the employee, and provides minimum value; failing this, the employer owes a shared-responsibility assessment to the IRS. The New York State Department of Financial Services regulates the coverage New York-licensed insurers sell to satisfy this federal requirement, but the duty to make the offer belongs to the employer itself.
Why the other options are wrong
- A) The shared-responsibility assessment is owed to the federal government when affordable coverage is not offered; it is not a per-enrollee fee paid to the state Department of Financial Services for employees who are covered.
- C) Medicare is a federal program primarily for older Americans and certain people with disabilities; an employer cannot satisfy the obligation to offer workplace coverage by shifting active full-time employees into Medicare.
- D) An accident-only policy does not provide the comprehensive minimum essential coverage the Affordable Care Act requires, and the offer obligation extends to full-time employees rather than the entire part-time workforce.
Memory hook
Employer shared responsibility: offer full-timers affordable, minimum-value coverage — or pay the IRS.