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For 2020, the Affordable Care Act’s (ACA) Employer Mandate is still in effect for Applicable Large Employers (ALEs). These ALEs must provide coverage that is “affordable” to all eligible full-time employees. For 2020, coverage is deemed to be “affordable” if the employee is charged no more than 9.78% of their household income. Because it is difficult to calculate an employee’s household income, three safe harbors were put in place to provide an alternative method of calculating affordability.

 

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