State ACA Filings
One of the emerging trends we are seeing in the compliance arena is that States have begun to require their own ACA filings. States like New Jersey and California have already passed state level legislation that requires their residents to purchase healthcare coverage or pay a penalty. Along with this state level mandate comes a reporting requirement on the state level that mirrors the requirements of the Affordable Care Act. In fact, New Jersey has simply adopted the 1095-C form as the required form at the State level.
In 2020 both New Jersey and Washington D.C. are requiring employers that employ NJ and Washington D.C. residents to submit 1095-C forms to their state and district systems. New Jersey's deadline for this filing requirement is March 31st, and for D.C. the deadline is June 30th. SyncStream fully supports the electronic filing of these forms for both New Jersey and Washington D.C.. We fully intend on supporting California in 2021 and any other state that begins introducing state level filings! Read more below about all state level activity.
New Jersey has passed the Health Insurance Market Preservation Act, which imposes an individual mandate requiring New Jersey residents to purchase healthcare coverage and report that to the state. In addition, employers must report and verify coverage that was offered to New Jersey residents. This means that applicable large employers (ALEs), defined the same as the in the Affordable Care Act (ACA), and all other providers of Minimum Essential Coverage (MEC) to New Jersey residents must send health-care coverage returns to the State for the 2019 Tax Year. New Jersey has clarified that employers will use the federal 1094 and 1095 B and C series forms to complete this filing requirement. Filing will be done on the State level through the same filing system employers use to file W-2 forms. SyncStream Solutions has been approved as a third party vendor to complete these filings on behalf of employers.
The District of Columbia's (D.C.) individual mandate requires residents to have qualifying coverage throughout 2019. In-state and out-of-state employers who withhold and pay payroll tax to D.C. or who employ D.C. residents, even if the employer does not withhold D.C. payroll taxes are subject to reporting. The reporting obligation is limited to Applicable Large Employers (ALEs). Employers who only have fully-insured coverage cannot rely on the insurer to provide 1095-B forms alone, they will still need to submit 1095-C and 1094-C forms to D.C. The first deadline for this reporting requirement is June 30th, 2020.
The State of California has also passed an individual mandate that requires residents to obtain qualifying coverage starting in 2020. In-state and out-of-state employers who employ California residents are obligated to file the same information found in the 1095 and 1094-C federal forms. Final details are not available, however it is anticipated that employers offering fully-insured coverage will rely on their insurance carrier to submit the data to the State, while employers offering self-insured coverage will submit their own data. The penalty for employers who fail to comply is $50 per individual not reported to the State. The first filing for employers will be due March 30, 2021.
The trend for States to implement their own individual mandate continues. Other states such as Rhode Island, Vermont and Massachusetts have taken some legislative steps towards this end.
Other states such as: Hawaii, Washington, Connecticut, Minnesota and Maryland are considering implementing an individual mandate along with an employer filing requirement.