Applicable large employers (i.e., employers with at least 50 full-time employees or full-time equivalent employees) that are subject to the Affordable Care Act’s employer shared responsibility provisions will need to examine the cost of coverage for 2023 plan years. For the second year in a row, the affordability percentage has decreased, from 9.61% of household income to 9.12% of household income.
Employers should review the affordability of their lowest-cost employee-only health coverage to avoid potential assessment of penalties for unaffordable coverage if an employee receives a premium tax credit. The penalty amount for unaffordable coverage for 2023 is $360/month or $4,320 annualized, per employee.
If you have any questions about this change, contact a Boutwell Fay attorney at attorneys@boutwellfay.com