Five states and the District of Columbia have passed laws requiring residents to have health insurance. Commonly referred to as an “individual mandate,” these laws reinforce one of the core tenets of the Affordable Care Act (ACA).
Here’s a brief recap of these laws, along with links for more information:
Beginning January 1, 2020, California residents must maintain minimum essential coverage for themselves and their dependents. If they don’t, they may have to pay a penalty (see the full text of the law for more information).
Insurance carriers, employers, and other “applicable entities” that provide minimum essential coverage to California residents must send coverage information to the California Franchise Tax Board (FTB) each year.
The annual reporting deadline is March 31. Because the law goes into effect in 2020, the first filing deadline is Mach 31, 2021.
While the FTB has said they will develop reporting forms, the required information is the same Section 6055 information sent to the IRS under the ACA.
The full text of the law is available at the California Legislative Information website.
The District of Columbia requires residents to maintain health insurance for tax years ending on or after December 31, 2019. Residents who don’t maintain coverage may have to pay a penalty.
The law also introduces ACA-like reporting requirements for “applicable entities.” In this case, an applicable entity is “an employer or other sponsor of an employment-based health plan or an insurance issuer or carrier licensed to or otherwise authorized to offer minimum essential coverage.”
The following applicable entities are required to file information returns with the Washington DC Office of Tax and Revenue (OTR):
At this time, it is unclear if the filing requirements apply to employees covered under an insured plan. Because insurance carriers are required to file returns, any information provided by employers would be redundant and seemingly unnecessary.
The reporting deadline for the tax year ending December 31, 2019, is June 30, 2020.
The full text of the law is available at the Council of the District of Columbia website.
The state of Massachusetts passed the nation’s first healthcare reform law in 2006 (the ACA was enacted in 2010). Residents who can afford coverage must maintain coverage throughout the year. If they don’t, they may have to pay a penalty.
Under the law, employers (or their vendors) that provide minimum creditable coverage (MCC) must distribute Form MA 1099-HC to covered residents by January 31 each year. This same information must be reported to the state Department of Revenue.
Insurers subject to the law must determine MCC status and typically handle the filing requirements. Employers who self-insure or contract with more than one vendor for a single plan may need to complete an attestation form.
The full text of the law is available at the Massachusetts Legislature website.
The Health Insurance Market Preservation Act requires all New Jersey residents to have health insurance beginning January 1, 2019. Those who don’t have minimum essential coverage may have to pay a penalty.
The State requires third-party proof that people have the required coverage. Starting with the 2019 tax year, all employers and other providers of MEC must send coverage information to the State each tax year. The information required by the State is the same information the IRS requires for ACA filings.
Employers and other providers must send this information to the State electronically. Filing paper forms is not an option.
For the 2019 tax year, this information must be provided to the state by March 31, 2020.
The law applies to employers in New Jersey AND employers from other states who remit gross income tax for New Jersey residents.
We can help employers meet their New Jersey filing requirements. Visit our New Jersey ACA page for more information.
The Market Stability and Reinsurance Act reinstates the individual coverage mandate for Rhode Island residents beginning in 2020. If residents don’t maintain coverage, they may have to pay a penalty (see the full text of the law for more information).
Every “applicable entity” that provides minimum essential coverage to an individual during a calendar year must file a return with the Rhode Island Division of Taxation. Details about the filing process are not available yet, but it appears that entities can use the same information filed with the IRS under the ACA to meet the state requirement.
The annual filing deadline is January 31. Because the law goes into effect in 2020, the first filing deadline is January 31, 2021.
The full text of the law is available at the Rhode Island website.
Residents of Vermont are required to maintain minimum essential coverage. At this time, there is no penalty for failing to maintain coverage.
There is no employer reporting requirement under the Vermont law. Instead, residents must report their coverage status when filing their tax returns (beginning with 2020 returns). If requested by the state, residents must provide copies of their IRS 1095 form as proof.
If Section 6055 reporting is eliminated in the future, Vermont will require employers and insurers to being filing coverage information with the state.
The full text of the law is available at the Vermont legislature website.