The Internal Revenue Service (IRS) issued Revenue Procedure 2018-34 regarding contribution percentages in 2019 for the purpose of determining the affordability of an employer’s health plan under the Affordable Care Act. For Plan years beginning in 2019, employer sponsored coverage will be considered affordable if the employee’s required contribution for self-only coverage does not exceed 9.86% (up from 9.56% in 2018) of the employee’s household income for the year.

Applicable Large Employers (ALEs), generally those who had 50 or more full time / full time equivalent employees during the preceding calendar year, may be subject to penalty if they do not offer affordable coverage that provides minimum value to their full-time employees. ALEs that fail to provide affordable coverage are liable for a penalty of $3,000 per year for full-time employees who receive a premium tax credit through an ACA Marketplace.  

If you have any questions about this ACA affordability, please contact your Sentinel Client Executive.