In the ever-evolving landscape of healthcare, businesses must navigate a myriad of choices when it comes to providing health insurance for their employees. One option that has gained attention, particularly among smaller businesses and those seeking to comply with the Affordable Care Act (ACA), is Minimum Essential Coverage (MEC) plans. 

These plans offer a set of benefits designed to meet ACA requirements, but they also come with their own set of advantages and disadvantages. In this article, we’ll delve into the pros and cons of MEC plans to help you determine if they are the right fit for your business.

Pros of Minimum Essential Coverage (MEC) Plans:


Affordability: MEC plans are often more budget-friendly for both employers and employees. They typically have lower premium costs compared to comprehensive health insurance plans, making them an attractive option for small businesses and cost-conscious individuals.

ACA Compliance: One of the primary advantages of MEC plans is their compliance with the ACA’s individual mandate. By offering MEC to your employees, you can avoid penalties associated with not providing health coverage, thus ensuring legal compliance.

Preventive Services: MEC plans cover essential preventive services at no cost to the employee. This includes vaccinations, screenings, and wellness check-ups, which can help identify health issues early and promote overall well-being.

Employee Retention: Offering any form of health coverage, including MEC plans, can enhance employee retention. It signals to your workforce that you care about their health and well-being, which can lead to increased job satisfaction and loyalty.

No Pre-existing Condition Exclusions: MEC plans cannot deny coverage or impose pre-existing condition exclusions. This means that employees with pre-existing medical conditions can access necessary care without fear of rejection.

Minimal Administrative Burden: MEC plans are relatively straightforward to administer compared to more comprehensive health insurance options. This can save businesses time and resources.


Cons of Minimum Essential Coverage (MEC) Plans:

Limited Coverage: While MEC plans meet ACA requirements, they offer limited coverage compared to more comprehensive health insurance options. They often cover only preventive services and may not provide coverage for major medical expenses, such as surgeries or hospital stays.

No Minimum Value: MEC plans do not meet the minimum value standard set by the ACA. This means they may not cover a substantial portion of medical costs, leaving employees with significant out-of-pocket expenses for major healthcare needs.

Employee Dissatisfaction: Employees may be dissatisfied with MEC plans due to their limited coverage. This can lead to frustration when they discover that their essential medical needs are not adequately covered, potentially affecting morale and job satisfaction.

Limited Network: MEC plans may have a restricted network of healthcare providers. Employees could find that their preferred doctors or hospitals are not included in the plan’s network, limiting their choices for care.

Not Ideal for All Businesses: MEC plans are best suited for businesses with a young, healthy workforce and those primarily seeking ACA compliance at a minimal cost. For businesses with diverse employee demographics and varying healthcare needs, more comprehensive plans may be a better fit.

Making an Informed Decision

Choosing the right health insurance option for your business involves careful consideration of your budget, employee needs, and legal obligations. While MEC plans offer affordability and ACA compliance, their limited coverage may not suit all employees or businesses. Before making a decision, assess your workforce’s healthcare requirements, and consider alternative options, such as group health plans or health savings accounts (HSAs). It’s essential to strike a balance between cost-effectiveness and meeting the healthcare needs of your employees.

Final Notes

MEC plans can be a viable choice for some businesses, especially those with budget constraints and a focus on complying with ACA regulations. However, they may not provide sufficient coverage for all employees, and careful evaluation of your workforce’s needs is crucial. Ultimately, the decision should align with your company’s goals, financial capacity, and commitment to employee well-being. To make an informed choice, consider consulting with an insurance expert or benefits consultant who can provide guidance tailored to your specific circumstances.

Any Questions?

We serve employers who want to offer their employees affordable benefits. We simplify the complexity of providing those benefits and ensure compliance with the Affordable Care Act. We provide affordable benefits for the everyday person. We are different because of our personal service, speed of implementation, and innovative approach to providing benefits coverage.


Learn more about us and our services, here.

With the 2024 employee benefits open enrollment season rapidly approaching, employers find themselves at a crucial crossroads in determining the affordability of their health plans for employees. 

Recent IRS guidance has ushered in significant changes, making it imperative for Applicable Large Employers (ALEs) to stay informed and navigate the evolving landscape. This comprehensive guide is designed to provide clear insights into the key considerations ALEs must bear in mind for 2024.

Understanding the 2024 Affordability Threshold

New Affordability Standard

In 2024, the affordability threshold takes a noteworthy plunge from 9.12% to a more restrictive 8.39% of an employee’s household income. This shift is far from just a statistical adjustment; it has far-reaching implications. Employers should be acutely aware of this change and its consequences.

Impact on Eligibility and Penalties

This reduction in the affordability threshold has several cascading effects. First, it affects individuals’ eligibility for federally subsidized coverage on the Exchange. When the threshold is lower, more employees may qualify for subsidies. This has the potential to drive up the number of employees seeking coverage on the Exchange, which can impact your workforce’s overall health and well-being.

More significantly, it carries the looming threat of potential fines upon employers under the Affordable Care Act (ACA) Employer Shared Responsibility provisions. If your health plans are deemed unaffordable for employees, you may face penalties. These penalties can be substantial and are calculated based on the number of full-time employees and the duration of the non-compliance.

Necessary Adjustments for Employee Contributions

Safe Harbor Adjustment

For ALEs relying on the safe harbor dollar amount to determine employee contributions, making the necessary adjustments for the lowest-cost, self-only plan in 2024 is imperative. The safe harbor is a protective mechanism provided by the IRS to help employers determine whether they are offering affordable coverage.

To calculate the maximum allowable employee contribution, employers must consider the new affordability threshold of 8.39% when setting employee contributions for the lowest-cost, self-only plan. Failure to adjust these contributions accordingly can result in penalties, which can quickly add up if a large number of employees are affected.

Additionally, for those operating on non-calendar-year plans, it’s advisable to wait for the U.S. Department of Health and Human Services (HHS) to publish the 2024 Federal Poverty Guidelines before setting employee contribution amounts. This step ensures that your contribution calculations are in alignment with the most current federal guidelines, reducing the risk of non-compliance.

Advantages for Pacific Northwest Employers

Higher Minimum Wages

One interesting facet of healthcare affordability standards is the regional variation in minimum wages. In the Pacific Northwest, minimum wages significantly exceed the federal minimum wage of $7.25 per hour. This difference can provide employers with a unique opportunity to make larger contributions while remaining within the bounds of affordability.

Employers in states like Oregon and Washington, where minimum wage rates are substantially higher than the federal minimum, can potentially offer more generous contributions to employee health plans. This is particularly true for employers adopting the Rate of Pay safe harbor method among the three available options.

Understanding ACA Affordability Standards

ACA Requirements

It’s crucial to remember the foundational requirements set forth by the Affordable Care Act. Under the ACA, Applicable Large Employers (ALEs) are mandated to provide affordable, minimum-value coverage to nearly all full-time employees (those averaging 30 hours per week) and their dependents. ALEs are defined as employers who averaged 50 or more full-time and full-time equivalent employees in the previous calendar year.

The definition of affordability is at the heart of ACA compliance. Coverage is considered affordable if the cost to the employee does not exceed a certain percentage of their income, which is now set at 8.39% for 2024. Understanding this principle is fundamental to ensuring compliance and avoiding penalties.

Deciphering Three Safe Harbors for Affordability

Your Options Unveiled:

The IRS offers three distinct safe harbors for employers to assess the affordability of their benefit offerings. These safe harbors provide a level of flexibility and certainty in determining whether your plans meet the ACA’s affordability standards. Let’s break down each one:


W-2 Wages: This safe harbor allows employers to gauge affordability based on an employee’s Form W-2 wages. In simple terms, it looks at the cost of coverage relative to what the employee earned.


Rate of Pay: The Rate of Pay safe harbor method calculates affordability based on an hourly employee’s contribution. It stipulates that the employee’s share of the premium should not exceed 8.39% of their hourly rate multiplied by 130 hours. For instance, let’s consider a minimum wage hourly worker in Portland, where the minimum wage is $15.45 per hour. According to this method, the maximum affordable contribution for this employee would be $168.51 per month. For salaried workers, the calculation is based on their monthly salary.

Federal Poverty Line (FPL): The FPL safe harbor method is another option for employers. It sets affordability at 8.39% of the federal poverty line, which is currently $14,580 for the mainland United States. This translates to a maximum allowable employee contribution of $101.94 per month.

Each of these safe harbors offers its advantages and considerations. Employers should carefully evaluate which one aligns best with their workforce composition and compensation structures.

Employer Shared Responsibility Payments Demystified

Penalties Unveiled:

The Employer Shared Responsibility provisions of the ACA can be complex to navigate. Understanding the potential penalties is crucial for ALEs. Let’s simplify the key aspects of these provisions:

“Part A Penalty”: This penalty comes into play when an ALE fails to offer minimum essential coverage to nearly all full-time employees, and at least one full-time employee purchases individual coverage from the Exchange and receives a premium subsidy. In such cases, the employer faces a penalty of $247.50 per month for each full-time employee (excluding the first 30 employees) for each month they failed to provide minimum coverage. To put this in perspective, consider an employer with 50 full-time employees who fail to offer at least 95% of them (48 employees) minimum essential coverage. If just one employee purchases insurance on the Exchange and receives a premium subsidy, the potential penalty could amount to $59,400 per year.

“Part B Penalty”: The Part B Penalty comes into play when an ALE fails to offer affordable minimum essential coverage. If at least one full-time employee purchases individual coverage from the Exchange and receives a premium subsidy, the employer will be penalized $371.66 per month for each individual receiving the premium subsidy. This is known as the “B penalty” under §4980H(b). It’s essential to note that this penalty can stack up for multiple employees, potentially leading to substantial financial consequences.

Key Actions for Employers in 2024

Navigating Open Enrollment

With the 2024 Open Enrollment season on the horizon, employers must take several key actions to ensure compliance and mitigate risks:


Review Safe Harbor Options: Begin by thoroughly reviewing the safe harbor options available to your organization. Each has its merits and considerations, and selecting the one that aligns best with your employee population is crucial.


Determine Employee Charges: Calculate the appropriate employee contributions for the most affordable plan offerings. Take into account the new affordability threshold of 8.39% when setting these contributions. Ensure that your calculations are precise and compliant.


Consider Non-Calendar-Year Plans: If your organization operates on a non-calendar-year plan, exercise prudence and wait for the U.S. Department of Health and Human Services (HHS) to publish the 2024 Federal Poverty Guidelines before finalizing employee contribution amounts.

Leveraging the Rate of Pay Safe Harbor in the Pacific Northwest

Maximizing Benefits

Employers in the Pacific Northwest, particularly in states like Oregon and Washington, have a unique opportunity to leverage the Rate of Pay safe harbor method to their advantage. Due to the significantly higher minimum wage rates in this region, employers can potentially offer more generous contributions without exceeding the affordability threshold.


Consider this scenario: A minimum wage hourly worker in Portland earns $15.45 per hour. According to the Rate of Pay safe harbor, the maximum affordable contribution for this employee would be $168.51 per month. This amount is notably higher than the $101.94 permitted by the FPL safe harbor method. For salaried workers in the Pacific Northwest, a similar advantage exists, enabling employers to provide competitive health benefits while remaining compliant.

Stay Informed and Compliant

Future-Proofing Your Approach

As the regulatory landscape governing healthcare affordability continues to evolve, staying informed and maintaining compliance with ACA regulations is paramount for ALEs. Ensuring that your employee health plans are both affordable and meet minimum value standards is an ongoing process.


Regularly monitor changes in regulations, affordability thresholds, and minimum wage rates in your region. Staying ahead of the curve is the key to providing affordable healthcare benefits for your employees while avoiding potential compliance pitfalls.

Still Have Questions?

We serve employers who want to offer their employees affordable benefits. We simplify the complexity of providing those benefits and ensure compliance with the Affordable Care Act. We provide affordable benefits for the everyday person. We are different because of our personal service, speed of implementation, and innovative approach to providing benefits coverage.


Learn more about us and our services, here.

In the world of employer compliance with the Affordable Care Act (ACA), 2024 brings significant changes as the IRS increases penalties for noncompliance.

Let’s dive into these updates and their practical implications for employers.

What is Changing in 2024?

In 2024, we can expect to see some noteworthy changes in the realm of noncompliance penalties. These penalties are set to undergo an increase, affecting various aspects of compliance.

Penalty A, for instance, will see its figures rise from $2,880 (equivalent to $240 per month) as of 2023, to a slightly higher $2,970 (approximately $247.50 per month).

Similarly, Penalty B will experience an uptick from its 2023 levels of $4,320 (or $360 per month) to the new rate of $4,460 (roughly $371.67 per month).

It’s important to note that these adjusted penalty amounts will come into play for taxable years and plan years commencing after the curtain falls on December 31, 2023. This shift toward higher penalties should act as a potent motivator for employers to reevaluate their group health plan offerings, with a focus on providing comprehensive coverage to their full-time employees. The emphasis is on ensuring affordability and the delivery of minimum value benefits, all in an effort to steer clear of the growing cost of noncompliance.

Penalty A: Insufficient Coverage Offerings

One of the critical components of the Affordable Care Act (ACA) revolves around Penalty A. This penalty comes into play when employers fail to provide minimum essential coverage to 95% of their full-time, benefits-eligible employees.

Penalty B: The Affordability Conundrum

Penalty B takes center stage when employers fall short in offering affordable, minimum value coverage to their benefits-eligible employees.

The Affordability Threshold: 2024 and Beyond

The affordability threshold, a key determinant of whether employer-sponsored health coverage meets ACA standards, remains a topic of anticipation for 2024. In 2023, it stood at 9.12%, down from the previous year’s 9.61%. This percentage plays a pivotal role in calculating how much eligible individuals can contribute from their household income to keep coverage within the bounds of affordability.

Navigating the IRS Penalties

For those employers who find themselves in noncompliance with either Penalty A or Penalty B, there’s a new challenge on the horizon: increased IRS penalties. According to IRS definitions under the ACA, employers with at least 50 full-time employees (including full-time equivalent employees) during the preceding year are categorized as Applicable Large Employers (ALEs) for the current calendar year. 

To trigger either penalty, an employer must be in violation, and at least one full-time employee must have utilized the premium tax credit to obtain coverage through the Marketplace. Understanding these intricacies is essential to successfully navigate the complex landscape of ACA penalties.

Common Compliance Pitfalls: Navigating ACA Challenges

When it comes to ACA compliance, even the most well-intentioned employers can find themselves entangled in a web of potential pitfalls. Understanding these common mistakes is key to avoiding penalties and ensuring a smooth journey through the intricacies of the Affordable Care Act. Let’s shed light on some of the areas where employers often stumble:

Incomplete Records: Failing to maintain accurate and complete records of employee hours and healthcare offerings can be a grave error. Incomplete or inaccurate documentation can lead to miscalculations in coverage requirements and, ultimately, penalties.

Misclassifying Employees: Incorrectly classifying employees as full-time or part-time can trigger compliance issues. Employers need to understand the ACA’s criteria for full-time status and ensure that classifications align with these standards.

Lack of Communication: Neglecting to communicate effectively with employees regarding healthcare options and requirements can result in confusion and noncompliance. Clear and timely communication is essential for keeping everyone on the same page.

Inadequate Affordability Calculations: The ACA’s affordability threshold is a critical factor. Employers must correctly calculate it to ensure their plans meet the affordability requirement. Failing to do so can lead to unexpected penalties.

Ignoring Seasonal Workers: Seasonal and variable-hour employees can be a compliance challenge. Employers often overlook the fact that they may need to offer coverage to these employees under certain circumstances.

Incomplete Reporting: ACA reporting, done using forms such as 1094-C and 1095-C, requires accuracy and timeliness. Errors or omissions in reporting can result in penalties, as the IRS uses this information to determine compliance.

Failure to Offer Coverage to Dependents: Employers must provide affordable coverage not only to employees but also to their dependents. Neglecting this aspect can lead to penalties and employee dissatisfaction.

Inadequate Recordkeeping: Proper recordkeeping is essential for ACA compliance. Employers must retain records related to health plan offerings, coverage, and employee information. Failure to maintain these records can hinder audits and lead to penalties.

By highlighting these common compliance pitfalls, employers can proactively address potential issues and navigate the ACA landscape more effectively. Understanding where mistakes often occur is the first step toward avoiding penalties and ensuring compliance with this ever-evolving legislation.

Still Have Questions?

We serve employers who want to offer their employees affordable benefits. We simplify the complexity of providing those benefits and ensure compliance with the Affordable Care Act. We provide affordable benefits for the everyday person. We are different because of our personal service, speed of implementation, and innovative approach to providing benefits coverage.

Learn more about us and our services, here.

As a Qualified Applicable Large Employer (ALE), choosing the right employee health insurance plan is crucial for your organization’s financial health and employee satisfaction. Two popular options for providing healthcare coverage to your employees are Fully Insured Plans and Level Funded Plans. In this comprehensive guide, we will delve into the differences, advantages, and considerations of both options to help you make an informed decision for your company’s healthcare benefits.

Understanding Fully Insured Plans: Exploring Benefits and Limitations

Fully Insured Plans are a type of employee health insurance where employers pay fixed premiums to an insurance carrier. In return, the carrier assumes the responsibility for covering employees’ healthcare costs, transferring the financial risk from the employer to the insurer.

Advantages of Fully Insured Plans

Cost Predictability: Fixed premiums allow accurate budgeting for healthcare expenses without unexpected fluctuations. Employers can plan their finances more effectively, knowing the exact cost of providing health insurance.

Simplified Administration: Insurance carriers handle plan administration, including claims processing and customer service, reducing administrative burden for employers. This allows HR teams to focus on other strategic initiatives.

Regulatory Compliance: Fully Insured Plans often come with pre-packaged ACA-mandated benefits, ensuring compliance with regulatory requirements. This helps employers avoid penalties and stay in line with federal healthcare laws.

Limitations of Fully Insured Plans

Limited Customization: Employers have less flexibility to tailor the plan to their workforce’s specific needs. The insurance carrier offers pre-determined benefit packages, which may not align perfectly with the preferences of your employees.

Cost Control: Employers may have less control over healthcare premiums as the insurer assumes financial risk. Premium increases may occur, leading to higher costs for employers without additional benefits.

Understanding these aspects of Fully Insured Plans is crucial for employers in making informed decisions while choosing the most suitable health insurance option for their workforce.

Unveiling Level Funded Plans: A Hybrid Approach to Employee Health Insurance

Level Funded Plans represent a unique approach to employee health insurance, combining elements of self-insurance and traditional insurance. In this arrangement, employers pay fixed monthly premiums to a third-party administrator (TPA), which holds the funds in a claims account. The TPA then uses these funds to cover employees’ healthcare expenses. If claims are lower than expected, the surplus is often returned to the employer at the end of the year, making it a potentially cost-saving option.

Advantages of Level Funded Plans


Cost Savings: Level Funded Plans offer potential cost savings compared to Fully Insured Plans. Unused claims funds may be returned to the employer, reducing overall healthcare expenses. This can be particularly beneficial for organizations with healthier employee populations.


Customization: Employers have more flexibility to tailor plan design and benefits to meet the specific needs of their workforce. This customization can lead to higher employee satisfaction and better alignment with your company’s unique culture and values.

Risks and Considerations of Level Funded Plans

Financial Risk: Although Level Funded Plans provide cost-saving potential, they also carry a higher level of financial risk compared to Fully Insured Plans. Employers are responsible for any claims exceeding the funds in the claims account. It is essential to assess your company’s financial stability and risk tolerance before opting for self-insurance.


Cash Flow Management: Employers must ensure they have sufficient cash flow to cover unexpected high claim costs since they are responsible for funding the claims account. Planning for potential fluctuations in claim expenses is critical to avoiding cash flow issues.

Key Differences: Fully Insured vs. Level Funded Plans

To better understand the distinctions between Fully Insured and Level Funded Plans, let’s explore their key differences in several areas:

Premiums and Payments

Fully Insured Plans: Fixed premiums are paid to the insurance carrier, and the insurer assumes the financial risk. Premiums may be subject to annual adjustments based on claims experience and other factors.


Level Funded Plans: Fixed premiums are paid to a third-party administrator, with the employer assuming the financial risk for claims. The TPA holds the claims funds and manages the claims payment process.

Financial Risk

Fully Insured Plans: The insurance carrier bears the financial risk of employees’ healthcare expenses. Employers pay fixed premiums and have no direct financial responsibility for claims costs.


Level Funded Plans: Employers partially self-insure by funding the claims account, assuming a portion of the financial risk. Stop-loss insurance may be used to limit financial exposure for high claim costs.

Regulatory Compliance

Fully Insured Plans: Often come with pre-packaged ACA-mandated benefits, ensuring compliance with federal regulations. Insurance carriers handle compliance-related administrative tasks.


Level Funded Plans: Allow more customization, but employers must ensure they comply with applicable federal and state regulations. HR teams and TPAs share the responsibility of compliance-related tasks.


Understanding these distinctions empowers employers to make well-informed decisions about employee health coverage, considering cost, risk, and regulatory requirements. By choosing the most suitable plan, employers can provide their workforce with comprehensive healthcare while optimizing budget allocation.

Plan Flexibility and Customization: Tailoring Benefits to Meet Your Employees’ Needs


Fully Insured Plans: Fully Insured Plans typically come with standardized benefit packages provided by the insurance carrier. While this offers simplicity and convenience, it may limit the ability to tailor the plan to the specific needs of your employees. Employers have less control over plan design, benefit levels, and cost-sharing arrangements.


Level Funded Plans: One of the primary advantages of Level Funded Plans is the increased flexibility and customization they offer. With Level Funded Plans, employers can work closely with the third-party administrator (TPA) to design a plan that aligns with their employees’ unique healthcare needs. This flexibility extends to benefit design, network selection, and even wellness programs. By having more control over plan features, employers can cater to the preferences of their workforce, leading to higher employee satisfaction and engagement.

Any Questions?

We are in the business of providing healthcare to everyday people, ensuring peace of mind through trust and transparency.

Our customer service is what sets us apart. We work when you work. Our carrier partners have given us exclusive offerings to complement our medical plans, giving you the best possible price. Our speed of implementation and innovative approach to benefit coverage is second to none.

Learn more about us and our services, here.

The unwinding of the Medicaid continuous enrollment provision marks a significant change in the Medicaid landscape in the United States. As states regain the ability to initiate disenrollments, it is important to understand the key aspects of this process. From potential coverage losses to addressing eligibility and awareness issues, various factors play a crucial role in navigating the unwinding of the continuous enrollment provision. 


By exploring these nine key things to know, we can better comprehend the unwinding of the Medicaid continuous enrollment provision and work towards maintaining accessible and equitable healthcare coverage for all individuals.

Unwinding Process

The unwinding of the Medicaid continuous enrollment provision began on March 31, 2023, allowing states to resume Medicaid disenrollments. This marked a significant shift in the Medicaid enrollment process, as states regained the ability to initiate disenrollments. 

However, it is important to note that states must adhere to specific rules to qualify for the phased reduction in enhanced federal Medicaid matching funds. These rules include not restricting eligibility standards, methodologies, and procedures, as well as refraining from increasing premiums as required under the FFCRA. By following these guidelines, states can ensure a smooth transition during the unwinding process.

Potential Coverage Losses

Estimates suggest that between 8 million and 24 million individuals may be disenrolled during the 12-month unwinding period, leading to a potential decline in enrollment between 8% and 28%. The scope of potential coverage losses highlights the significant impact of the unwinding of the continuous enrollment provision. Approximately 17 million people could lose their Medicaid coverage if enrollment decreases by 18%. These figures underscore the need to closely monitor the unwinding process and implement strategies to mitigate coverage losses.

Eligibility and Awareness

Many individuals who may be disenrolled during the unwinding period are still eligible for Medicaid. Survey findings indicate that a significant number of enrollees are unaware of the need to renew their coverage. This lack of awareness poses a challenge as eligible individuals may unintentionally lose their Medicaid coverage. 

Enrollees report no change in income or circumstances that would make them ineligible for Medicaid, highlighting the potential disconnect between their eligibility and their knowledge of the unwinding process. It is crucial to address this gap in awareness and ensure that eligible individuals are well-informed about the renewal requirements to retain their coverage.

Disenrollment Risks

Certain groups that experienced substantial growth under the continuous enrollment provision, such as ACA expansion adults, other adults, and children, are expected to witness the largest declines in enrollment. These groups, which have benefited significantly from the continuous enrollment provision, are now at risk of losing their Medicaid coverage. 

It is important to address the disenrollment risks faced by these vulnerable populations and implement targeted strategies to assist eligible individuals in retaining coverage. Conducting outreach programs, providing education, and offering enrollment assistance will be crucial in ensuring that those who remain eligible for Medicaid can navigate the unwinding process and retain their coverage.

Engaging Community Health Centers and Assister Programs

Community health centers and assister programs are crucial stakeholders in supporting Medicaid enrollees throughout the unwinding process. These organizations can provide valuable information and assistance to enrollees, helping them navigate the renewal process and understand their coverage options. 

Community health centers and assister programs can assist individuals in updating their contact information, completing the necessary documentation, and transitioning to alternative coverage options if they are no longer eligible for Medicaid. Their involvement is essential in ensuring that individuals receive the necessary support and guidance during this transitional phase.

Timely Data and Reporting

States are required to provide baseline data and monthly reports to monitor the unwinding process effectively. These reports serve as essential tools for tracking various metrics related to renewals, disenrollments, and pending renewals. By analyzing this data, states can gain valuable insights into the progress of the unwinding process and identify any potential challenges or disparities. Timely and accurate reporting enables policymakers and stakeholders to make informed decisions and develop targeted interventions to address emerging issues.

State Approaches

States have adopted different strategies for handling the unwinding process, reflecting the diverse landscape of Medicaid programs across the country. The variation in disenrollment rates among states that have already resumed disenrollments highlights the importance of understanding and analyzing state-specific approaches. 

Monthly reports provide a comprehensive overview of state efforts and enable policymakers to evaluate the impact of different strategies. By studying these variations, states can learn from one another’s experiences and identify best practices to optimize their own unwinding processes.

Addressing Operational Challenges

The unwinding of the continuous enrollment provision presents operational challenges for states, including staffing shortages and outdated systems. To address these challenges, CMS has provided temporary waivers that allow states to simplify the renewal process for select enrollees. 

These waivers offer flexibility in streamlining administrative tasks, reducing bureaucratic hurdles, and minimizing procedural terminations. By leveraging these waivers, states can optimize their operational processes and ensure a more efficient unwinding process.

Increase in Uninsured Individuals

The termination of the continuous enrollment provision raises concerns about an increase in the uninsured population. Efforts should focus on simplifying the transition to alternative coverage options and reducing barriers that may prevent individuals from accessing healthcare. It is crucial to implement strategies that facilitate smooth transitions for individuals who are no longer eligible for Medicaid, ensuring they have access to other sources of coverage, such as ACA marketplaces or other programs. 

By addressing the potential increase in uninsured individuals, policymakers can work towards maintaining affordable and accessible healthcare for all.

Final Notes

The unwinding of the Medicaid continuous enrollment provision brings significant changes to Medicaid enrollment and coverage. It is crucial for states to address potential coverage losses, support eligible individuals in maintaining their healthcare coverage, and ensure a smooth transition for those no longer eligible. Partnering with community health centers, and assister programs, along with timely data and reporting, are essential for effective monitoring of the unwinding process. Ultimately, the goal is to mitigate the increase in uninsured individuals by simplifying transitions and ensuring equitable access to healthcare for all.

Any Questions?

We are in the business of providing healthcare to everyday people, ensuring peace of mind through trust and transparency.

Our customer service is what sets us apart. We work when you work. Our carrier partners have given us exclusive offerings to complement our medical plans, giving you the best possible price. Our speed of implementation and innovative approach to benefit coverage is second to none.


Learn more about us and our services, here.

In today’s competitive job market, employers are constantly seeking new ways to attract and retain top talent. One area that has seen significant advancements and innovation is employee benefits. As the workforce evolves, so do the expectations and needs of employees. In this blog post, we will explore the future of employee benefits, focusing on the emerging trends and innovations with a particular emphasis on Minimum Essential Coverage (MEC).

Personalization and Customization

In the future, employee benefits will increasingly focus on personalization and customization. Recognizing that employees have diverse needs and preferences, employers are moving away from one-size-fits-all benefits packages and are offering more flexibility. MEC provides a foundation of basic coverage while allowing employees to choose additional benefits that align with their specific requirements. This level of personalization ensures that employees feel valued and supported, leading to increased job satisfaction and engagement.

The concept of personalization extends beyond traditional health benefits. Employees may have different priorities when it comes to benefits, such as parental leave, flexible work arrangements, or professional development opportunities. Employers can leverage MEC to offer a menu of benefits from which employees can select, tailoring their packages to meet individual needs. This approach not only enhances employee satisfaction but also demonstrates an organization’s commitment to supporting a diverse workforce.

Wellness and Mental Health Support

As organizations prioritize employee well-being, the focus on wellness and mental health support is becoming more prominent. MEC is adapting to this trend by including comprehensive wellness programs as part of the benefits package. These programs may offer access to mental health resources, fitness classes, meditation apps, or even virtual therapy sessions. By proactively addressing employees’ holistic health needs, employers can create a more productive and supportive work environment.

The integration of wellness initiatives into MEC reflects a growing recognition of the importance of mental health in overall well-being. Employers understand that a healthy workforce is a more engaged and productive one. By providing resources and support for mental health, organizations can help employees navigate stress, reduce burnout, and improve overall job satisfaction. Additionally, wellness programs can foster a positive company culture that values employee well-being.

Financial Wellness

Financial wellness is another area gaining traction in the realm of employee benefits. Employers recognize that financial stress can negatively impact employees’ overall well-being and productivity. MEC can incorporate financial education programs, retirement planning resources, and access to financial advisors. By promoting financial literacy and offering tools for long-term financial planning, employers can empower employees to make informed decisions and improve their financial well-being.

MEC can offer benefits such as employer-matched retirement savings plans, automatic contributions to health savings accounts, or access to financial planning tools and workshops. By addressing financial wellness as part of the benefits package, employers can help alleviate employee anxiety around financial matters, enabling them to focus on their work and personal lives. This approach also positions employers as partners in their employees’ long-term financial success.

Flexible Work Arrangements

The COVID-19 pandemic has accelerated the adoption of remote work and flexible work arrangements. In the future, the hybrid work model is likely to become the norm for many organizations. MEC can adapt to this change by providing benefits that cater to the specific needs of remote and flexible workers. This could include virtual healthcare options, telemedicine services, and flexible scheduling for appointments or personal time off. By ensuring that benefits are accessible and relevant regardless of the employee’s location, employers can foster a positive work-life balance.

MEC can support flexible work arrangements by offering benefits that accommodate different work styles. For example, it may include subscriptions to coworking spaces, reimbursement for home office equipment, or technology tools that facilitate remote collaboration. By embracing the changing nature of work and tailoring benefits to remote and flexible workers, employers can attract and retain talent who value work-life integration and flexibility.

Technology and Digital Solutions

Advancements in technology have a significant impact on the future of employee benefits. MEC is embracing this trend by incorporating digital solutions that streamline benefit administration, enrollment processes, and communication channels. Mobile apps, online portals, and AI-powered chatbots enable employees to access information, make benefit choices, and seek assistance conveniently. Technology-driven benefits solutions not only enhance employee experience but also reduce administrative burdens for HR teams.


Digital solutions offer employees easy access to benefits information, allowing them to make informed decisions and manage their benefits effectively. With self-service portals and mobile apps, employees can review their coverage, access educational resources, and make changes to their benefits as needed. Additionally, digital communication channels enable efficient and personalized communication between employees and HR teams, fostering transparency and improving employee engagement.

Integration and Data Analytics

Another emerging trend in employee benefits is the integration of different benefits platforms and data analytics. MEC can serve as a central hub that integrates various benefits offerings, including health insurance, retirement plans, wellness programs, and more. This integration allows for a seamless employee experience, simplifying benefit management and ensuring that employees have a holistic view of their benefits.


Furthermore, data analytics play a crucial role in optimizing benefits offerings. By leveraging data on employee utilization, preferences, and feedback, employers can gain valuable insights into the effectiveness of their benefits programs. Data analytics can help identify trends, anticipate employee needs, and make data-driven decisions to enhance the overall benefits package.

Regulatory Compliance and Changing Landscape

The future of employee benefits is also influenced by evolving regulatory requirements and societal changes. Employers must stay informed about changing regulations and adapt their benefits offerings accordingly. MEC provides a framework that ensures compliance with minimum requirements while offering flexibility for additional benefits. It allows employers to navigate the complex landscape of healthcare regulations and provide employees with essential coverage.


Societal shifts, such as the growing focus on diversity, equity, and inclusion (DEI), also impact employee benefits. Employers are recognizing the need to create benefits packages that address the unique needs of a diverse workforce, ensuring equitable access to opportunities and resources. MEC can be customized to include benefits that support DEI initiatives, such as diverse supplier programs, mentorship programs, or educational resources on unconscious bias.

Final Notes

As the workplace landscape continues to evolve, employee benefits are evolving with it. The future of employee benefits lies in personalization, wellness support, financial well-being, flexibility, and technology-driven solutions. MEC serves as a flexible foundation that can adapt to these emerging trends and innovations, allowing employers to create attractive benefits packages that meet the diverse needs of their workforce.


 By investing in forward-thinking employee benefits, organizations can attract top talent, enhance employee engagement, and foster a culture of well-being and productivity. With MEC at the core of their benefits strategy, employers can navigate the changing landscape of employee benefits while providing essential coverage and tailored benefits that empower their employees to thrive.

Any Questions?

We serve employers who want to offer their employees affordable benefits. We simplify the complexity of providing those benefits and ensure compliance with the Affordable Care Act. We provide affordable benefits for the everyday person. We are different because of our personal service, speed of implementation, and innovative approach to providing benefits coverage.


Learn more about us and our services, here.

Living a longer, healthier life requires physical activity, eating healthy, and routine visits to the doctor. When these three factors work together, it allows you to stay your healthiest. In turn- your odds of living longer increase.

The Importance of Physical Activity

Physical activity doesn’t always mean an intense hour-long workout at the gym every day. While this form of exercise has great benefits, it’s not for everyone. 

A more sedentary lifestyle is becoming more common in today’s popular work-from-home world. Fewer people are spending time standing, walking, or moving around. 

The American Heart Association found that, “sedentary jobs have increased 83% since 1950.” 

Sedentary Lifestyles and Their Negative Effects

The lack of movement (rather than sitting itself) is the culprit for the negative effects of sedentary jobs. The Mayo Clinic analyzed 13 studies and found that all found, “sitting time and activity levels found in those who sat for more than 8 hours a day with no physical activity had a risk of dying similar to the risks of dying posed by obesity and smoking.” 

How Sitting for Extended Periods Can Be Harmful

Most office or stay-at-home workers sit for about 15 hours a day, not including commuting time if there is any.  Spending over half of the day seated means workers are spending less time active. 

The Benefits of Walking for Your Health

The British Journal of Sports Medicine found that walking for at least 11 minutes a day combats the negative effects of sitting for extended periods of time. That’s about the length of listening to four songs. More sedentary participants risked dying younger at a much higher rate than active study participants. 

This study gathered data from volunteers in Europe and the United States who wore accelerometers. The levels of physical exercise fell into three categories: 

  • Little physical activity – typically walking two or three minutes a day
  • Moderate physical activity- typically 11 minutes of walking a day
  • Moderately higher physical activity – 35 minutes of brisk walking or moderate activity 

The study gathered data from volunteers in Europe and the United States who wore accelerometers to measure their levels of physical activity. The participants were divided into three categories based on their levels of physical exercise. Those with little physical activity walked two or three minutes a day, while those with moderate physical activity walked about 11 minutes a day. Finally, those with moderately higher physical activity walked about 35 minutes a day at a brisk pace or engaged in moderate physical activity.

The results of the study were clear: participants with little physical activity had a shorter lifespan and were more likely to die prematurely than those who were more active. However, those who moved for 11 minutes per day were found to be much less likely to die prematurely than their sedentary counterparts. The best results for longer lifespans were observed in people who walked about 35 minutes per day at a brisk pace or engaged in moderate physical activity.

Walking offers a range of benefits beyond combating the negative effects of sitting. It can help improve cardiovascular health, strengthen bones and muscles, and even improve mood and cognitive function. Regular walking can also help you maintain a healthy weight, reduce the risk of chronic diseases like diabetes and heart disease, and improve overall quality of life.

Incorporating walking into your daily routine doesn’t have to be difficult. Even taking a short walk during your lunch break, parking your car a little further away from your destination, or walking to nearby stores instead of driving can make a difference. Additionally, walking with a friend or family member can make it a more enjoyable and social activity.

How Much Walking is Enough for a Longer Life?

Participants with little physical activity had a shorter lifespan. Researchers found that 260 percent of these participants were more likely to die prematurely than more active participants. However, participants who moved for 11 minutes per day were found to be much less likely to die prematurely. The best results for longer life spans were with people who walked about 35 minutes per day. 

The study conductor, Ulf Ekelund, professor of epidemiology and physical activity at the Norwegian School of Sport Sciences in Oslo, Norway explains, “ brisk walking is excellent moderate exercise.” Adding a healthy habit that takes 30 minutes or less may be one of the best and simple ways to lengthen your life. 

Take Action Today for a Healthier, Longer Life

Adding healthy habits to your daily routine is much easier than taking away unhealthy habits. In the end, even 11 minutes of a brisk walk creates positive lifelong impacts to increase your lifespan. Start today towards 11 minutes to a longer life. 

For more healthy habit tips, read our article: How to eat Healthy on a Budget. We give our suggestions on healthy eating that don’t focus on the organic aisle section. 

Innovative HIA makes healthcare affordable by focusing on the insurance needs of people and trimming away the things most people don’t actually want. How do we do it? Let’s discuss.

Innovative HIA Provides Affordable Care Act Compliant Benefits

Any ACA-compliant benefit plan must cover these 10 health benefits:

  • “Ambulatory services
  • Emergency services
  • Hospitalization
  • Pregnancy, maternity, and newborn care (before and after birth)
  • Mental health and substance use disorder services
  • Prescription drugs
  • Rehabilitative and habilitative services and devices
  • Laboratory services 
  • Preventative and wellness services and chronic disease management 
  • Pediatric services”

Minimum Essential Coverage (MEC) is a classification of insurance plans that meet the Affordable Care Act requirements for health insurance coverage. Plans that meet MEC requirements include marketplace, job-based plans, Medicare, and Medicaid.

MEC can be a cost-effective way to ensure that families are protected in times of need but employers aren’t overpaying for unnecessary services.

Why Do Employers Need to Offer Coverage?

Employers must offer at least Minimum Essential Coverage (MEC) to any benefit-eligible employee. Non-compliance will generally result in a penalty of $2,750 annually PER eligible employee


Innovative HIA provides benefits that will meet these requirements and keep employers from being penalized without making them pay for the services they don’t need. We offer affordable coverage for all clients, with a variety of options, including telehealth, vision, and dental voluntary benefits.

How Affordable Are Innovative HIA’s ACA Compliant Plans?

Many of Innovative HIA’s plans cost less than $100/month and include virtual health, worksite benefits, vision, dental, and ACA-compliant plans that are affordable for both employers and employees.

Innovative HIA plans also offer the bundling of medical and ancillary benefit options, making affordable healthcare options easy for employers. This is a significant contrast to many employers paying thousands of dollars a month for major medical coverage.

Let’s Talk Telehealth Services: Giving People Medical Care at the Right Place and Time

Telehealth services experienced a spike in popularity during the COVID-19 pandemic. Why? Telehealth services allow patients to stay home and keep others safe as well as work around a collection of other challenges, such as:

  • Problems finding childcare
  • Issues driving to or navigating a hospital due to a disability
  • Difficulty getting time off work


Innovative HIA’s virtual health and telemedicine services offer plan participants 24/7 access to their doctor, at no cost to them. They can speak to a licensed physician as and when they need, by phone or video, and find the complete solution to their health care needs.


Learn more about telehealth services.

Innovative HIA Gives Users What They Want: Hassle-free, Basic Care

Innovative HIA knows what the users of its insurance want, need, and expect: they want to go to the doctor when they need a check-up, they want to be able to get their kids registered for school with all their shots, and they want doctor visits and prescriptions to be as efficient and hassle-free as possible. 

Learn more about Innovative HIA and our benefit plans.  

Frank Crivello: Meeting Real-World Insurance Needs to Make Healthcare Affordable For All   

Frank Crivello, CEO of SBMA believes that success is not a destination, but a journey. He defines success as the balance of achievement and satisfaction.

“If you don’t like what you’re doing but you have a ton of money, that’s not success. If you do like what you’re doing and don’t have any money, well, that’s not success either,” he says.

Meeting the real-world insurance needs of people

Despite not having gone to Harvard or pursued advanced degrees, Frank achieved success just by learning from everyone around him.

“I’ve absorbed incredible insights and lessons from business owners and co-workers, from janitors and motivational speakers. Innovative HIA is successful because we listen to the needs of our brokers and the companies we serve, and then exceed expectations,” he states.

When Frank first started out in the insurance industry, he noticed that all the third party administrators were offering all kinds of products that their employer groups didn’t want or need. So when he built Innovative HIA, it was specifically to meet the real-world needs of the people they served. 

Innovative HIA provides ACA compliant benefits administration for large employers all across the US. The company’s offices and customer care center are located in sunny San Diego, CA.

“Insurance is not a new industry and, to be honest, major medical is not a place where much innovation takes place. At Innovative HIA we saw the opportunity to innovate in the MEC space, and seized the chance to really make a difference,” states Frank.

He notes that SBMA provides affordable coverage for all of its clients, with a variety of options, including telehealth, vision, and dental voluntary benefits. Their revolutionary idea was to offer plan participants real-world benefits they can actually use.

Providing affordable healthcare options for all

Innovative HIA benefit plans provide a complete solution for employers who want to provide affordable benefits to their workers. The firm offers the most competitive limited medical plans in the industry, with seamless benefits that work like major medical, ensuring ACA compliance for the employer at a price they and their employees can afford.

Many of Innovative HIA’s plans cost less than $100/month, and include Virtual Health, Worksite Benefits, Vision, Dental, and ACA compliant plans that both employers and employees can afford.

Innovative HIA plans also offer the bundling benefits of medical and ancillary options, making affordable healthcare options easy for the employers. Frank points out that not everyone wants to pay out thousands of dollars a month for major medical.

“Our benefits provide coverage for those who value acute care, prescription coverage, and regular DR visits, but don’t want to pay for comprehensive major medical. We created healthcare that costs between $40 to $125/month, by carving out the big ticket items to build plans that give people benefits they actually use. Practical, useable, affordable, and ACA compliant benefits for everyday people! That’s our revolution!” he declares.

Frank points out that, prior to the pandemic, the majority of patients preferred in-person doctor visits over telehealth options. However, when a contagious airborne virus appeared, telehealth options expanded dramatically. Almost all health insurance providers now have new, simple-to-use options.

With a Virtual Health medical professional on the line at any time of day or night, nationwide telehealth services help avoid unnecessary doctor visits, and provide numerous financial benefits to both healthcare providers and patients.

Telehealth services can help reduce transportation costs and save money for both patients and providers. Virtual visits aid in increasing patient retention, streamlining time on task, improving appointment compliance, lowering overhead costs, and reducing in-person liability.

Innovative HIA’s virtual health and telemedicine services offer plan participants 24/7 access to their doctor, at no cost to them. They can speak to a licensed physician as and when they need, by phone or video, and find the complete solution to their health care needs.

Flipping the MEC model on its head

Minimum essential coverage (MEC) is an insurance plan that meets the Affordable Care Act requirements for health insurance coverage. Plans under MEC include marketplace, job-based plans, Medicare, and Medicaid.

Prior to the Affordable Care Act, insurers would refuse to insure people with preexisting medical conditions. Those who had used too much of their medical coverage in the past were also at risk of losing it.

MEC ensures that all enrollees have access to insurance, regardless of their health status or the plan they choose. It can be a cost-effective way to ensure that families are protected in times of need. Frank points out that the MEC space has traditionally been filled by those providing minimum essential coverage paired with minimum service.

“We flipped the model on its head by providing gold standard service to accompany the government mandated MEC coverage that employers must offer to be ACA compliant,” he states.

Innovative HIA knows what the users of its insurance want, need, and expect. They want to go to the doctor when they need a check-up, they want to be able to get their kids registered for school with all their shots, and they want doctor visits and prescriptions to be as hassle-free as possible. 

Innovative HIA also knows what its employer groups want: Fast enrollment and off boarding, no hassle ID cards, no hassle claims, and coordinated technology that streamlines their experience. And finally, the firm makes brokers’ lives better by taking all the hand-holding off their plates. 

Brokers are able to provide employer groups not only with great rates and easy compliance with the ACA requirements, but they can also hand those employer groups off to Innovative HIA, knowing that there will be a gold standard support team handling every phase of their relationship, from the moment the group enrolls.

A respected leader who commands trust and faith

Frank defines his leadership style as casual, collaborative, and authoritative. “Don’t mistake that for authoritarian. I know what needs to be done, and am clear with everyone around me. I move fast, make decisions with certainty, and I pivot easily,” he points out.

As CEO, Frank ensures that Innovative HIA is on track to be the best in the industry. His relationships with the leading brokers keep his finger on the pulse of the industry, allowing Innovative HIA to be more agile, more responsive, and a better partner for its brokers, and employer groups, with the freedom to be the best ACA compliant MEC coverage provider in the industry.

Some of the people on Frank’s leadership team have been with him since the early days, which he feels is a testament to the strength of their trust and faith in him as a leader.

“Nobody gave me anything starting out,” Frank observes. “I had to earn everything from the ground up. That might make some people resentful, but not me. I’m grateful for all the hard work I put in to get here. The view from the top is amazing, especially if you took the stairs.”

Today, SBMA is the industry leader in providing MEC coverage. Over the past five years, the firm has grown to become the gold standard in customer service by building the technology to streamline all of its operations. “I see blue skies and market domination in our future. And, I’m just getting started!” states Frank.

As a father, Frank dotes on his two beautiful daughters who keep him grounded and balanced. “They’re everything to me. Watching them grow up, and creating a life for them where they see that hard work pays off, and that grit and determination is enough to succeed, gives me great satisfaction,” he says.

Frank’s parting advice to aspiring business leaders is to: LISTEN. Don’t let ego get in the way of learning. It’s easy to think you already know, or even to worry that someone will think you’re stupid if you don’t know the answer. Lose that perspective as fast as possible. If you can absorb everyone else’s knowledge and experience around you, you will accelerate your own trajectory to success.

If you’re considering purchasing health insurance, you may feel overwhelmed by the variety of terminology associated with it. From coinsurance to deductibles, there are numerous health insurance terms you should know before you enroll. But don’t worry; we’ve got you covered. We have translated some of the confusing terminologies around health insurance into plain English to help you better understand your health insurance coverage.

Let’s dive in.


Coinsurance is a health insurance term that refers to the percentage of the cost of a healthcare service that you are responsible for paying after you have met your health insurance plan’s deductible. 

For example, if your healthcare bill is $1,000 and you have already met your deductible, and your coinsurance is 20%, you will be responsible for paying $200 (20% of $1,000), while your insurance company will pay the remaining $800. Coinsurance is one of the ways in which health insurance companies share the cost of healthcare services with their policyholders.


Copay refers to a fixed amount of money that you may need to pay out-of-pocket for a covered healthcare service or supply. For example, your health plan may require a $20 copay for an office visit or a $10 copay for a generic prescription. After you pay the copay, your health insurance plan will cover the remaining cost of the healthcare service or supply. 

Copays are a way for health insurance companies to share the cost of healthcare services with their policyholders. Copay amounts may vary depending on the type of healthcare service or supply, and the specifics of your health insurance plan.


A deductible is the amount of money that you need to pay out-of-pocket for healthcare services before your insurance plan starts covering those services. For example, if your plan has a $1,000 deductible, you will need to pay the first $1,000 of healthcare services you receive during the year before your plan starts contributing to the cost of covered services. Once you’ve met your deductible, your insurance plan will begin to share the cost of healthcare services with you. The amount of the deductible can vary depending on the specifics of your insurance plan and is an important factor to consider when choosing a plan, as it can significantly impact your out-of-pocket costs for healthcare.

Essential Health Benefits

Let’s talk about Essential Health Benefits – a set of healthcare services that must be covered by plans in the Health Insurance Marketplace, as required by the Affordable Care Act. These benefits include emergency services, hospitalization, maternity and newborn care, mental health, prescription drugs, preventive and wellness services, pediatric services, and more. 

In-Network Providers

Understanding the difference between in-network and out-of-network providers is critical. In-network providers are a group of doctors, hospitals, and other healthcare providers that your health insurance plan has partnered with to provide care to its members. 

Out-of-Network Providers

When you receive healthcare services from a provider that has not partnered with your insurance plan to provide care to its members, this is known as an out-of-network provider. It’s important to note that using an out-of-network provider may result in additional costs for you, so it’s crucial to know which providers are in-network before receiving care.

Another important term to be familiar with is out-of-pocket cost, which refers to the amount you pay for health care services. This may include your deductible, coinsurance, and co-pays.

The out-of-pocket maximum is the most you’ll pay in a policy period, usually one year, before your plan starts to pay 100% of the covered Essential Health Benefits you receive. This limit must include deductibles, coinsurance, and co-payments, but typically does not count premiums toward your out-of-pocket maximum.

Monthly Premiums

Monthly premiums refer to the regular payments that an individual pays to their health insurance company in exchange for coverage. This payment can be made on a monthly, quarterly, or yearly basis depending on the insurance plan. 

The amount of the premium varies based on a number of factors, such as the type of coverage, the individual’s age, location, and the level of benefits they choose. It’s important to understand the cost of the monthly premium when selecting a health insurance plan, as it can impact your budget and overall financial health.

Preventative Care

Preventive care is health care services focused on keeping you healthy before you may become sick. These include routine check-ups, patient counseling, screening tests, and immunizations. Plans must offer these services at no cost to you when the services are provided by in-network doctors. This means they can’t charge a copayment or coinsurance, even if you haven’t met your deductible for the year.


Lastly, it’s important to understand what a provider is. This refers to a person or place you go to receive health care services. Examples include doctors, hospitals, pharmacies, and more. Check with your health insurance plan to find out if a provider is in-network or out-of-network.

By familiarizing yourself with these health insurance terms, you can better understand your coverage and make an informed decision when choosing a health insurance plan.

Still Have Questions?

We serve employers who want to offer their employees affordable benefits. We simplify the complexity of providing those benefits and ensure compliance with the Affordable Care Act. We provide affordable benefits for the everyday person. We are different because of our personal service, speed of implementation, and innovative approach to providing benefits coverage.

Learn more about us and our plans, here.

As an ALE, understanding the regulations set forth by the Affordable Care Act (ACA) can be a daunting task. The employer mandate, minimum essential coverage (MEC), minimum values, and affordability are all crucial guidelines that must be understood to avoid penalties.

In this blog, we will answer some frequently asked questions about ACA and ALEs to help you stay informed and compliant. We will cover topics such as what is an ALE, how to calculate workforce size, common ownership impact on ALE status, timing impact on ALE status calculation, the employer mandate, minimum essential coverage, and more. So, let’s get started!

First, What is an ALE?

An ALE, or applicable large employer, is a company or organization that employs at least 50 full-time equivalent (FTE) employees. The IRS defines a full-time employee as someone who works at least 30 hours per week or 130 hours of service per calendar month.

 Even if a company doesn’t have 50 full-time employees at all times, it just needs to average at least 50 FTEs per month in the current calendar year to be considered an ALE for the following calendar year.

How Does an Employer Calculate Workforce Size to Determine if They’re an ALE?

To determine if your company is considered an ALE, you must add the number of full-time employees and the full-time equivalent of your part-time employees. only U.S employees should be counted. 

To calculate the full-time equivalent of your part-time employees, take the total hours worked by all part-time workers in a month and divide by 120. Then add this number to the total number of full-time employees to get your total FTE count. If you have seasonal workers, they must be included in the FTE count, but you may be able to apply for an exemption if their hours cause the count to exceed 50 or more.

You are eligible for the seasonal worker exemption if you meet the following conditions:

  • Your total number of full-time employees (including FTEs) exceeds 50 for a maximum of 120 days in a calendar year.
  • The excess employees during this period are considered seasonal workers.

How Does Common Ownership Impact ALE Status?

To determine if a group of businesses are considered an ALE, they must be evaluated together as a controlled group. This applies even if the businesses are separate legal entities. If the controlled group is determined to be an ALE, each individual business within the group is considered an ALE, regardless of the total number of employees and is subject to the employer shared responsibility provisions (ESRP) of the ACA.

How Does Timing Impact ALE Status Calculation?

When determining ALE status, it is important to consider the preceding calendar year. Employers who were established during part of the previous year will have their calculations adjusted accordingly. New businesses that did not exist on any day in the previous year will be considered an ALE if they anticipate and do employ an average of 50 or more full-time employees, including full-time equivalentsduring the current calendar year.

What is the Employer Mandate?

The employer mandate, also known as the Employer Shared Responsibility Provisions (ESRP), is a requirement under the Patient Protection and Affordable Care Act (ACA) that applies only to businesses that are considered Applicable Large Employers (ALEs). These employers are required to offer health insurance coverage that meets minimum essential coverage (MEC) and is considered affordable to their full-time employees and their dependents, or they may face penalties. 

Businesses that do not qualify as ALEs are not subject to these requirements or penalties. Only full-time employees, not full-time equivalents, are counted for the purpose of calculating penalties and the first 30 full-time employees are not factored into the calculation.

What is Minimum Essential Coverage?

The Affordable Care Act (ACA) requires that ALEs provide a minimum level of health insurance coverage, known as minimum essential coverage (MEC), to at least 95% of their full-time employees. This is to avoid paying penalties under the employer shared responsibility provisions (ESRP). 

To meet this requirement, ALEs must offer their employees the opportunity to enroll in a health insurance plan that meets the standards set forth by the ACA, such as those offered in the small or large group market, grandfathered health plans, or certified by the Health Insurance Marketplace.

How is Affordability Defined and Calculated?

To be considered “affordable” under the Affordable Care Act, a health plan’s cost for an employee cannot exceed 9.12% of their annual household income in 2023. This calculation is based on the employee’s salary and the lowest cost silver plan available for their age and location.

Does the Employer Mandate Require Coverage be Offered to Dependents?

The employer mandate under the ACA stipulates that ALEs must provide qualified and affordable health coverage options to their employees and their eligible dependents. According to the mandate, dependents are defined as an employee’s child under the age of 26, including adopted or placed for adoption children. It should be noted that spouses, stepchildren, foster children, or non-U.S. citizen children not living in the U.S. or a contiguous country do not fall under the definition of dependents.

When Would an Employer be Subject to Potential Employer Shared Responsibility Penalties?

There are two types of financial penalties for ALEs (Applicable Large Employers) under Section 4980H of the Internal Revenue Code. The first penalty (4980H(a)) applies to ALEs that do not offer Minimum Essential Coverage (MEC) to at least 95% of their full-time employees and dependents. The second penalty (4980H(b)) applies to ALEs that do not offer affordable coverage to their full-time employees and dependents.

If an ALE fails to meet these requirements and at least one full-time employee receives federal subsidies, such as premium tax credits for purchasing essential coverage through the Marketplace, the ALE will be subject to penalties. 

How Much are the Penalties for Failing to Meet the Employer Mandate?

The IRS updates the penalties for employer mandates annually. In 2023, the penalties are as follows:

  • Section 4980H(a) penalty: ALEs that do not provide Minimum Essential Coverage to 95% of full-time employees will face a penalty of $2,880 per full-time employee.
  • Section 4980H(b) penalty: ALEs that do not offer affordable or minimum value coverage will face a penalty of $4,320 per full-time employee.

These penalties may be adjusted based on the number of employees who received subsidies for coverage and how many months employees were not covered. The IRS will apply the higher penalty of the two options, meaning that both penalties cannot be imposed simultaneously.

Still Have Questions?

The best way for employers to remain compliant with healthcare laws is to consult with a team of professionals. Our team at Innovative Health Insurance Advisors understands the ACA and can help you stay up-to-date on any changes to the law.