HR Tip: Start educating workers about form 1095-C

The Affordable Care Act’s (ACA) reporting requirements apply to employers with 50 or more full-time or equivalent employees for calendar year 2015. There is no extra year of relief from reporting for mid-size employers, as there is under the employer shared responsibility provisions.

One of these forms is 1095-C, which applicable large employers (ALE) must provide to their employees annually, along with Form W-2, by the end of January. 2016 is the first year employees will receive this form and they need to know what it is, what it means and what to do with it. It provides information for employees to use when completing their income tax returns, showing that they or their family members had qualifying health coverage (referred to as “minimum essential coverage”) for some or all months during the year.

Who must receive the form?

  • Forms must be furnished to everyone who has been a full-time employee for one or more months of the calendar year, including former employees and COBRA participants, regardless of whether the employee is participating in an employer-sponsored group health plan. The form provides information for all 12 months of the calendar year for each employee.
  • Each part-time employee who is enrolled in the employer’s self-insured health plan must receive the form.
  • Part-time employees who are not enrolled in the plan do NOT have to receive the form.


Small employers

Small employers with fewer than 50 FTEs also will be required to file Forms 1095-C and 1094-C if they are members of a controlled or affiliated service group that collectively has at least 50 FTEs. Those with a self-insured health plan must complete and file Forms 1095-B. For fully insured plans, insurance companies will provide the 1095-Bs.

Start communicating now

The sooner employers start education, the less confusion and fewer questions there will be. Now is a good time to include an article in the company newsletter, post information on the company intranet, and prepare a fact sheet. Open enrollment materials should include information. Email communications, posters, and other appropriate marketing channels should be used in December and January to get the word out. After the form 1095-C is sent, a follow up email saying it should have arrived is a good idea.

IRS questions and answers

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