Patient Protection and Affordable Care Act/Title I/Subtitle F/Part II

by United States Congress

PART II—EMPLOYER RESPONSIBILITIES

SEC. 1511. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE EMPLOYERS.

The Fair Labor Standards Act of 1938 is amended by inserting after section 18 (29 U.S.C. 218) the following:

`SEC. 18A. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE EMPLOYERS.

`In accordance with regulations promulgated by the Secretary, an employer to which this Act applies that has more than 200 full-time employees and that offers employees enrollment in 1 or more health benefits plans shall automatically enroll new full-time employees in one of the plans offered (subject to any waiting period authorized by law) and to continue the enrollment of current employees in a health benefits plan offered through the employer. Any automatic enrollment program shall include adequate notice and the opportunity for an employee to opt out of any coverage the individual or employee were automatically enrolled in. Nothing in this section shall be construed to supersede any State law which establishes, implements, or continues in effect any standard or requirement relating to employers in connection with payroll except to the extent that such standard or requirement prevents an employer from instituting the automatic enrollment program under this section.'.

SEC. 1512. EMPLOYER REQUIREMENT TO INFORM EMPLOYEES OF COVERAGE OPTIONS.

The Fair Labor Standards Act of 1938 is amended by inserting after section 18A (as added by section 1513) the following:

`SEC. 18B. NOTICE TO EMPLOYEES.

`(a) In General- In accordance with regulations promulgated by the Secretary, an employer to which this Act applies, shall provide to each employee at the time of hiring (or with respect to current employees, not later than March 1, 2013), written notice--

`(1) informing the employee of the existence of an Exchange, including a description of the services provided by such Exchange, and the manner in which the employee may contact the Exchange to request assistance;

`(2) if the employer plan's share of the total allowed costs of benefits provided under the plan is less than 60 percent of such costs, that the employee may be eligible for a premium tax credit under section 36B of the Internal Revenue Code of 1986 and a cost sharing reduction under section 1402 of the Patient Protection and Affordable Care Act if the employee purchases a qualified health plan through the Exchange; and

`(3) if the employee purchases a qualified health plan through the Exchange, the employee will lose the employer contribution (if any) to any health benefits plan offered by the employer and that all or a portion of such contribution may be excludable from income for Federal income tax purposes.

`(b) Effective Date- Subsection (a) shall take effect with respect to employers in a State beginning on March 1, 2013.'.

SEC. 1513. SHARED RESPONSIBILITY FOR EMPLOYERS.

(a) In General- Chapter 43 of the Internal Revenue Code of 1986 is amended by adding at the end the following:

`SEC. 4980H. SHARED RESPONSIBILITY FOR EMPLOYERS REGARDING HEALTH COVERAGE.

`(a) Large Employers Not Offering Health Coverage- If--

`(1) any applicable large employer fails to offer to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan (as defined in section 5000A(f)(2)) for any month, and

`(2) at least one full-time employee of the applicable large employer has been certified to the employer under section 1411 of the Patient Protection and Affordable Care Act as having enrolled for such month in a qualified health plan with respect to which an applicable premium tax credit or cost-sharing reduction is allowed or paid with respect to the employee,

then there is hereby imposed on the employer an assessable payment equal to the product of the applicable payment amount and the number of individuals employed by the employer as full-time employees during such month.

`(b) Large Employers With Waiting Periods Exceeding 30 Days-

`(1) IN GENERAL- In the case of any applicable large employer which requires an extended waiting period to enroll in any minimum essential coverage under an employer-sponsored plan (as defined in section 5000A(f)(2)), there is hereby imposed on the employer an assessable payment, in the amount specified in paragraph (2), for each full-time employee of the employer to whom the extended waiting period applies.

`(2) AMOUNT- For purposes of paragraph (1), the amount specified in this paragraph for a full-time employee is--

`(A) in the case of an extended waiting period which exceeds 30 days but does not exceed 60 days, $400, and

`(B) in the case of an extended waiting period which exceeds 60 days, $600.

`(3) EXTENDED WAITING PERIOD- The term `extended waiting period' means any waiting period (as defined in section 2701(b)(4) of the Public Health Service Act) which exceeds 30 days.

`(c) Large Employers Offering Coverage With Employees Who Qualify for Premium Tax Credits or Cost-sharing Reductions-

`(1) IN GENERAL- If--

`(A) an applicable large employer offers to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan (as defined in section 5000A(f)(2)) for any month, and

`(B) 1 or more full-time employees of the applicable large employer has been certified to the employer under section 1411 of the Patient Protection and Affordable Care Act as having enrolled for such month in a qualified health plan with respect to which an applicable premium tax credit or cost-sharing reduction is allowed or paid with respect to the employee,

then there is hereby imposed on the employer an assessable payment equal to the product of the number of full-time employees of the applicable large employer described in subparagraph (B) for such month and 400 percent of the applicable payment amount.

`(2) OVERALL LIMITATION- The aggregate amount of tax determined under paragraph (1) with respect to all employees of an applicable large employer for any month shall not exceed the product of the applicable payment amount and the number of individuals employed by the employer as full-time employees during such month.

`(d) Definitions and Special Rules- For purposes of this section--

`(1) APPLICABLE PAYMENT AMOUNT- The term `applicable payment amount' means, with respect to any month, 1/12 of $750.

`(2) APPLICABLE LARGE EMPLOYER-

`(A) IN GENERAL- The term `applicable large employer' means, with respect to a calendar year, an employer who employed an average of at least 50 full-time employees on business days during the preceding calendar year.

`(B) EXEMPTION FOR CERTAIN EMPLOYERS-

`(i) IN GENERAL- An employer shall not be considered to employ more than 50 full-time employees if--

`(I) the employer's workforce exceeds 50 full-time employees for 120 days or fewer during the calendar year, and

`(II) the employees in excess of 50 employed during such 120-day period were seasonal workers.

`(ii) DEFINITION OF SEASONAL WORKERS- The term `seasonal worker' means a worker who performs labor or services on a seasonal basis as defined by the Secretary of Labor, including workers covered by section 500.20(s)(1) of title 29, Code of Federal Regulations and retail workers employed exclusively during holiday seasons.

`(C) RULES FOR DETERMINING EMPLOYER SIZE- For purposes of this paragraph--

`(i) APPLICATION OF AGGREGATION RULE FOR EMPLOYERS- All persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of the Internal Revenue Code of 1986 shall be treated as 1 employer.

`(ii) EMPLOYERS NOT IN EXISTENCE IN PRECEDING YEAR- In the case of an employer which was not in existence throughout the preceding calendar year, the determination of whether such employer is an applicable large employer shall be based on the average number of employees that it is reasonably expected such employer will employ on business days in the current calendar year.

`(iii) PREDECESSORS- Any reference in this subsection to an employer shall include a reference to any predecessor of such employer.

`(3) APPLICABLE PREMIUM TAX CREDIT AND COST-SHARING REDUCTION- The term `applicable premium tax credit and cost-sharing reduction' means--

`(A) any premium tax credit allowed under section 36B,

`(B) any cost-sharing reduction under section 1402 of the Patient Protection and Affordable Care Act, and

`(C) any advance payment of such credit or reduction under section 1412 of such Act.

`(4) FULL-TIME EMPLOYEE-

`(A) IN GENERAL- The term `full-time employee' means an employee who is employed on average at least 30 hours of service per week.

`(B) HOURS OF SERVICE- The Secretary, in consultation with the Secretary of Labor, shall prescribe such regulations, rules, and guidance as may be necessary to determine the hours of service of an employee, including rules for the application of this paragraph to employees who are not compensated on an hourly basis.

`(5) INFLATION ADJUSTMENT-

`(A) IN GENERAL- In the case of any calendar year after 2014, each of the dollar amounts in subsection (b)(2) and (d)(1) shall be increased by an amount equal to the product of--

`(i) such dollar amount, and

`(ii) the premium adjustment percentage (as defined in section 1302(c)(4) of the Patient Protection and Affordable Care Act) for the calendar year.

`(B) ROUNDING- If the amount of any increase under subparagraph (A) is not a multiple of $10, such increase shall be rounded to the next lowest multiple of $10.

`(6) OTHER DEFINITIONS- Any term used in this section which is also used in the Patient Protection and Affordable Care Act shall have the same meaning as when used in such Act.

`(7) TAX NONDEDUCTIBLE- For denial of deduction for the tax imposed by this section, see section 275(a)(6).

`(e) Administration and Procedure-

`(1) IN GENERAL- Any assessable payment provided by this section shall be paid upon notice and demand by the Secretary, and shall be assessed and collected in the same manner as an assessable penalty under subchapter B of chapter 68.

`(2) TIME FOR PAYMENT- The Secretary may provide for the payment of any assessable payment provided by this section on an annual, monthly, or other periodic basis as the Secretary may prescribe.

`(3) COORDINATION WITH CREDITS, ETC.- The Secretary shall prescribe rules, regulations, or guidance for the repayment of any assessable payment (including interest) if such payment is based on the allowance or payment of an applicable premium tax credit or cost-sharing reduction with respect to an employee, such allowance or payment is subsequently disallowed, and the assessable payment would not have been required to be made but for such allowance or payment.'.

(b) Clerical Amendment- The table of sections for chapter 43 of such Code is amended by adding at the end the following new item:

`Sec. 4980H. Shared responsibility for employers regarding health coverage.'.

(c) Study and Report of Effect of Tax on Workers' Wages-

(1) IN GENERAL- The Secretary of Labor shall conduct a study to determine whether employees' wages are reduced by reason of the application of the assessable payments under section 4980H of the Internal Revenue Code of 1986 (as added by the amendments made by this section). The Secretary shall make such determination on the basis of the National Compensation Survey published by the Bureau of Labor Statistics.

(2) REPORT- The Secretary shall report the results of the study under paragraph (1) to the Committee on Ways and Means of the House of Representatives and to the Committee on Finance of the Senate.

(d) Effective Date- The amendments made by this section shall apply to months beginning after December 31, 2013.

SEC. 1514. REPORTING OF EMPLOYER HEALTH INSURANCE COVERAGE.

(a) In General- Subpart D of part III of subchapter A of chapter 61 of the Internal Revenue Code of 1986, as added by section 1502, is amended by inserting after section 6055 the following new section:

`SEC. 6056. LARGE EMPLOYERS REQUIRED TO REPORT ON HEALTH INSURANCE COVERAGE.

`(a) In General- Every applicable large employer required to meet the requirements of section 4980H with respect to its full-time employees during a calendar year shall, at such time as the Secretary may prescribe, make a return described in subsection (b).

`(b) Form and Manner of Return- A return is described in this subsection if such return--

`(1) is in such form as the Secretary may prescribe, and

`(2) contains--

`(A) the name, date, and employer identification number of the employer,

`(B) a certification as to whether the employer offers to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan (as defined in section 5000A(f)(2)),

`(C) if the employer certifies that the employer did offer to its full-time employees (and their dependents) the opportunity to so enroll--

`(i) the length of any waiting period (as defined in section 2701(b)(4) of the Public Health Service Act) with respect to such coverage,

`(ii) the months during the calendar year for which coverage under the plan was available,

`(iii) the monthly premium for the lowest cost option in each of the enrollment categories under the plan, and

`(iv) the applicable large employer's share of the total allowed costs of benefits provided under the plan,

`(D) the number of full-time employees for each month during the calendar year,

`(E) the name, address, and TIN of each full-time employee during the calendar year and the months (if any) during which such employee (and any dependents) were covered under any such health benefits plans, and

`(F) such other information as the Secretary may require.

`(c) Statements To Be Furnished to Individuals With Respect to Whom Information Is Reported-

`(1) IN GENERAL- Every person required to make a return under subsection (a) shall furnish to each full-time employee whose name is required to be set forth in such return under subsection (b)(2)(E) a written statement showing--

`(A) the name and address of the person required to make such return and the phone number of the information contact for such person, and

`(B) the information required to be shown on the return with respect to such individual.

`(2) TIME FOR FURNISHING STATEMENTS- The written statement required under paragraph (1) shall be furnished on or before January 31 of the year following the calendar year for which the return under subsection (a) was required to be made.

`(d) Coordination With Other Requirements- To the maximum extent feasible, the Secretary may provide that--

`(1) any return or statement required to be provided under this section may be provided as part of any return or statement required under section 6051 or 6055, and

`(2) in the case of an applicable large employer offering health insurance coverage of a health insurance issuer, the employer may enter into an agreement with the issuer to include information required under this section with the return and statement required to be provided by the issuer under section 6055.

`(e) Coverage Provided by Governmental Units- In the case of any applicable large employer which is a governmental unit or any agency or instrumentality thereof, the person appropriately designated for purposes of this section shall make the returns and statements required by this section.

`(f) Definitions- For purposes of this section, any term used in this section which is also used in section 4980H shall have the meaning given such term by section 4980H.'.

(b) Assessable Penalties-

(1) Subparagraph (B) of section 6724(d)(1) of the Internal Revenue Code of 1986 (relating to definitions), as amended by section 1502, is amended by striking `or' at the end of clause (xxiii), by striking `and' at the end of clause (xxiv) and inserting `or', and by inserting after clause (xxiv) the following new clause:

`(xxv) section 6056 (relating to returns relating to large employers required to report on health insurance coverage), and'.

(2) Paragraph (2) of section 6724(d) of such Code, as so amended, is amended by striking `or' at the end of subparagraph (FF), by striking the period at the end of subparagraph (GG) and inserting `, or' and by inserting after subparagraph (GG) the following new subparagraph:

`(HH) section 6056(c) (relating to statements relating to large employers required to report on health insurance coverage).'.

(c) Conforming Amendment- The table of sections for subpart D of part III of subchapter A of chapter 61 of such Code, as added by section 1502, is amended by adding at the end the following new item:

`Sec. 6056. Large employers required to report on health insurance coverage.'.

(d) Effective Date- The amendments made by this section shall apply to periods beginning after December 31, 2013.

SEC. 1515. OFFERING OF EXCHANGE-PARTICIPATING QUALIFIED HEALTH PLANS THROUGH CAFETERIA PLANS.

(a) In General- Subsection (f) of section 125 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

`(3) CERTAIN EXCHANGE-PARTICIPATING QUALIFIED HEALTH PLANS NOT QUALIFIED-

`(A) IN GENERAL- The term `qualified benefit' shall not include any qualified health plan (as defined in section 1301(a) of the Patient Protection and Affordable Care Act) offered through an Exchange established under section 1311 of such Act.

`(B) EXCEPTION FOR EXCHANGE-ELIGIBLE EMPLOYERS- Subparagraph (A) shall not apply with respect to any employee if such employee's employer is a qualified employer (as defined in section 1312(f)(2) of the Patient Protection and Affordable Care Act) offering the employee the opportunity to enroll through such an Exchange in a qualified health plan in a group market.'.

(b) Conforming Amendments- Subsection (f) of section 125 of such Code is amended--

(1) by striking `For purposes of this section, the term' and inserting `For purposes of this section--

`(1) In General- The term', and

(2) by striking `Such term shall not include' and inserting the following:

`(2) LONG-TERM CARE INSURANCE NOT QUALIFIED- The term `qualified benefit' shall not include'.

(c) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2013.