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Tuesday, January 2, 2018

2018 Coverage Codes You Need to Know for ACA Compliance


We know you are hard at work preparing for the ACA filing season, so we wanted to make sure you have all the 2018 coverage code information you need to stay ACA compliant. One of the most important aspects of the Form 1095-C is knowing how to indicate data about the coverage offered to employees. To do this your business will need to use Code series 1 and Code Series 2 in lines 14 and 16 of Form 1095-C. The IRS will review the codes used and make sure you are compliant with your ACA employer requirements. Here are the most common 2018 Coverage Codes you need to know for ACA compliance.

Most Common 2018 Coverage Codes You Need to Know for ACA Compliance


Form 1095-C: Line 14 Codes

The code used in line 14 will indicate to the IRS and recipients certain details about the healthcare coverage offered to that specific recipient. You will need a code for each month, and the code will indicate whether your business offered coverage that met minimum essential coverage (MEC), the minimum value (MV), and dependent coverage guidelines.

Most Common Series 1 Codes - Offer of Coverage
  • Code 1A. Qualifying Offer made to the employee, their spouse, and dependent(s), if any.
    • Qualifying Offers provide MEC at MV with the Employee Required Contribution being no more than 9.5% of the mainland single federal poverty line, as adjusted.
  • Code 1B. MEC offered at MV to the employee only.
  • Code 1C. MEC offered at MV to the employee and their dependent(s).
  • Code 1H. Coverage was not offered to the employee.

Form 1095-C: Line 16 Codes

In this section, you will explain in more detail what you have entered on line 14. Unlike line 14, line 16 can be left blank if one of the codes in series 2 apply to your employee's situations.

Most Common Series 2 Codes - Section 4980H Safe Harbor Codes and Other Relief for ALE Members
  • Code 2A. 
  • The employee was not employed during this month.
    • Do not use code 2A if the employee worked even one day during the month.
    • Do not use code 2A if the employee was fired.
  • Code 2B. 
    • The employee was not working full-time during this month.
    • The employee was not full-time and did not enroll in coverage.
    • The employee was full-time but coverage ended only because the employee resigned.
  • Code 2C. 
    • The employee enrolled in the coverage offered.
    • Do not use code 2C if code 1G is in line 14.
    • Do not use code 2C if the coverage did not meet MEC.
    • Do not use code 2C for months a terminated employee is enrolled in COBRA continuation coverage.

ACAWise Offers Automatic Code Generation

If learning all of the needed codes seems overwhelming, use ACAWise’s automatic code generation feature to simplify your ACA filing. Simply provide the information you have on your employees' insurance coverage and offered and our software will do the rest. Based on the information given we will make sure the right codes are in the place before filing your Form 1095-C.

Take advantage of our automatic code generation today!