Employer Mandate

Employers must offer health insurance that is affordable and provides minimum value to 95% of their full-time employees and their children up to the end of the month in which they turn age 26, or be subject to penalties. This is known as the employer mandate. It applies to employers with 50* or more full-time employees, and/or full-time equivalents (FTEs). Employees who work 30 or more hours per week are considered full-time.

Employer Mandate Requirements

Affordable coverage

Coverage is considered "affordable" if employee contributions for employee-only coverage do not exceed a certain percentage of an employee's household income (9.86% in 2019 and 9.78% in 2020).

Based on IRS safe harbors, coverage is affordable if the cost of self-only coverage is less than the indexed percentage of the following:

Employee's W-2 wages (reduced by any salary reductions under a 401(k) plan or cafeteria plan)
Employee's monthly wages (hourly rate x 130 hours per month),
OR
Federal Poverty Level for a single individual

Penalties

Employers who fail to offer coverage to at least 95% of full-time employees and dependents may be subject to a penalty of $2,320 per full-time employee minus the first 30.
Employers who offer coverage may still be subject to a penalty if the coverage is not affordable or does not provide minimum value. This penalty is the lesser of either $3,480 per full-time employee receiving a federal subsidy for coverage purchased on the Marketplace, or $2,320 per full-time employee minus the first 30.

Reporting

Affordable Care Act reporting is the action of filing required information to the Internal Revenue Service (IRS) and sending copies to recipients/employees. The Affordable Care Act requires employers to file annual information returns with the IRS and furnish statements to employees on healthcare plan coverage information.

Employees: The federal filing deadlines for ACA reporting are consistent with W-2 & 1099 reporting. Form 1095-B or form 1095-C, as applicable, must be provided to recipients/employees by January 31, similar to W-2's. This means that statements for 2018 must be provided no later that January 31, 2019.
Insurance Company: For calendar 2018, employers with 50 or more full-time employees (including full-time equivalent employees), all self-insured employers (regardless of size) and insurance companies (where applicable) must report healthcare coverage information to employees and the IRS. Reporting is mandatory for 2018 and is the responsibility of the businesses, not the insurance company.
IRS: If you are an insurance company or business that is required to report healthcare coverage you will need to file one or two form types to the federal government. Both paper and e-file are acceptable filing methods, with the e-file threshold being 250 forms.

Employers with 50 or more full-time employees (including full-time equivalent employees) within the previous year and all self-insured employers regardless of size must report healthcare coverage information to employees and the IRS. Full-time employees are those who worked an average of 30 hours or more per week for more than 120 days in a year. Using this guideline, you may have less than 50 full-time employees, but meet the requirements for ACA reporting. IRS.gov has a great estimator tool, including a Full-time Equivalent Employee Estimator, to help determine your filing obligation.

How do I know if I should be reporting?

According to the IRS website:

“To determine its workforce size for a year an employer adds its total number of full-time employees for each month of the prior calendar year to the total number of full-time equivalent employees for each calendar month of the prior calendar year and divides that total number by 12.”

The IRS also has an estimator that can help determine if your business would be considered an ALE:

https://taxpayeradvocate.irs.gov/estimator/esrp/