What is the total cost of your own health insurance coverage? If you don’t know now, you soon will find out! For tax years beginning after December 31, 2010, the Patient Protection and Affordable Care Act (PPACA) requires employers to disclose the cost of employer-sponsored health coverage on Form W-2.
Below are some relevant items regarding this disclosure:
- Disclosure does not alter the otherwise tax-free nature of this employee benefit;
- All group health plans are subject to this disclosure, including self-insured plans;
- A breakdown of various types of medical coverage (i.e. health, vision, dental, etc.) is not required;
- Employer-sponsored coverage does not include certain coverage such as long-term care, accidents, or disability income, or coverage for a specified disease or illness; and
- Employer-sponsored insurance does not include any salary reduction contributions to a flexible spending arrangement under a cafeteria plan or contributions to a medical or health savings account.
The aggregate cost of employer-sponsored coverage under any group health plan, whether paid by employee or employer, is determined under rules similar to those used to determine the premiums for purposes of COBRA continuation coverage.
If we can assist with implementation of this legislation or provide more information, please contact the experts listed below at (800) 270-9629.
