Benefits Buzz

CMS Employer Subsidy Audits by Phone and/or Mail

Posted on May 23rd, 2016

As required under the ACA, the federal government must conduct audits of Marketplace coverage to ensure that only people who are truly eligible are receiving a subsidized plan.
Effective Spring 2016, CMS launched an "Employer Initiatives" Program to aid in the auditing process. As part of this program, CMS may contact an employer to request whether or not one or more employees were enrolled in minimum essential coverage, or whether or not they were offered a health plan which was affordable and had minimum value. 
There are currently two CMS Employer Initiatives: 
Employer Verification Study by Phone
Participation is voluntary
A CMS contractor may contact employers by phone through the end of June 2016. 
Employers will be asked to give information about: 
  • The lowest-cost self-only health plan they offered for the 2016 plan year 
  • Their employees' eligibility for employer-sponsored coverage
Each call is expected to last between 10 and 15 minutes.
Employer Notice(s) by Mail
Employers may receive notification(s) by mail of employees who enrolled in a Qualified Health Plan with Marketplace financial assistance.
An employer that receives a notice can appeal the Marketplace's determination that it does not offer minimum essential coverage that is affordable to the employee and meets minimum value.
The primary purpose of these notice(s) are to "police" eligibility for subsidies. The IRS will independently determine any liability for penalties relating to the Employer Mandate through Section 6056 reporting (Forms 1094-C and 1095-C).
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The materials contained within this communication are provided for informational purposes only and do not constitute legal or tax advice.   

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