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How to Determine If Coverage an Employer Offers Is Sufficient to Avoid Pay or Play Penalty Under the Affordable Care Act

Author: Brian G. Muse, LeClairRyan

Under the Affordable Care Act (ACA), an applicable large employer (ALE) must offer its full-time employees the opportunity to enroll in minimum essential coverage (MEC) that meets the ACA's minimum value and affordability requirements. ALE's that either do not offer MEC or offer MEC that does not provide minimum value or is considered unaffordable may be subject to a pay or play penalty.

The following steps can help an employer determine if the coverage it offers is sufficient to avoid a pay or play penalty.