A large employer with 50 or more full-time employees is subject to a penalty if it’s medical plan does not offer minimum value and if an employee receives a tax credit to buy health coverage through the Marketplace. A plan fails to provide minimum value if the plan's share of the total allowed costs of benefits provided under the plan is less than 60% of such costs.
An individual who purchases coverage through the Marketplace will not be eligible for the tax credit if the individual is eligible for other minimum essential coverage, including coverage under an employer-sponsored plan that is affordable and provides minimum value.
The Department of Health and Human Services released an actuarial value calculator that employers can use to determine if their plan provides minimum value. The Calculator produces an empirical estimate of the actual average spending by a wide range of consumers representative of those currently enrolled in self-insured employer health plans. The calculator itself is set forth in an Excel spreadsheet. It is designed to give an estimate of value, and uses data from a large database as background for the working tables. The Calculator allows users to specify several plan design features. To access the Calculator, click here and select the AV Calculator for 2018 under the right menu bar.
