The Patient Protection and Affordable Care Act (ACA) became law in 2010 as a comprehensive initiative to increase health insurance coverage among U.S. residents.

Individual Mandate – January 1, 2014All U.S. residents, subject to certain exceptions, must secure the minimum essential health coverage for themselves and their dependents or pay an annualized penalty tax for each month of non-compliance. Minimum essential coverage is available through employer-sponsored plans, individual market plans, or government-sponsored programs, such as Medicare/Medicaid. Individual mandate exceptions apply if the health coverage is unaffordable because cost exceeds 8% of household income or if the absence of health coverage is less than three consecutive months. The annualized penalty for not having essential coverage escalates yearly and depends on level of income and number of household members.

2014 2015 2016 After 2016

Penalty is the greater of A or B

A$95.00 per adult $47.50 per child (up to $285.00 per family)

$325.00 per adult $167.50 per child (up to $975.00 per family)

$695.00 per adult$347.50 per child (up to $2,085.00 per family)

Penalty rate is adjusted by cost of living

B 1% of family income*

2% of family income*

2.5% of family income*

Penalty rate is adjusted by cost of living

* Income above the federal income tax filing threshold.

Government-Run Health Insurance Exchanges – October 1, 2013Many states have established health insurance exchanges for consumers to purchase individual health insurance plans for themselves and their dependents. Consumers complete an application to purchase insurance, and those consumers falling within defined income limits (up to 400% of federal poverty level) may be eligible to receive a government subsidy to reduce the price of their health plan if they have not received an offer of compliant health coverage from their employer.

Affordable Care Act for Production Workers

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Taxpayers will need to file proof of essential coverage (IRS Form 1095-C) in their income tax return or include the penalty payment with the return.

2016.01.06

Notice of Health Exchange (NOE) Employees should receive a NOE from their employers. The NOE contains standardized information about the government-run health exchanges and information about the employer’s health insurance coverage, or a statement that the employer does not provide health insurance.

EP Cares™ Insurance Program for Production Companies

Beginning January 1, 2016, employers with 50 or more full-time employees and equivalents must either offer health insurance to their full-time employees and dependents, or pay a penalty tax if any such full-time employee or dependent purchases subsidized coverage on a government-run health exchange. EP has launched EP Cares™, a health insurance program carried by Cigna, as a solution that production companies can consider if they wish to insure their non-union employees. EP Cares™ health insurance is portable for employees, meaning the employee may choose to continue the same plan with the same doctors if switching from one employer to another that also maintains EP Cares™ health insurance.

Employers can subscribe now by contacting epcares@ep.com or 855.339.7350.

Open enrollment ran from November 9 through December 4, 2015, for coverage beginning January 1, 2016.

For additional information about the ACA, please visit our ACA Compliance Center at ep.com/aca.

The IRS hosts a library of information for individual households about the ACA at irs.gov/Affordable-Care-Act/Individuals-and-Families.

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Sample NOE