Health Care Reform

Penalties for Noncompliance

If a plan does not comply with the applicable ACA plan design mandates, the employer may be subject to the excise taxes imposed under HIPAA. The penalty is generally $100 per day for each affected individual up to the date of correction (which essentially means making a correction that would give the participant the benefits to which he or she is entitled under ACA).

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Penalty FAQ

  • Who is tasked with enforcing the ACA requirements?

    Answer: It depends on the requirement. Three Federal agencies share jurisdiction over the ACA plan design mandates that amended HIPAA: the Departments of the Treasury, Labor, and Health and Human Services. Tax provisions are generally interpreted and enforced by the Department of the Treasury and IRS. Some provisions are enforced under state law, such as certain components of rate review, external review, and medical loss ratio requirements.

American Fidelity Assurance Company does not provide tax or legal advice.


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