The following are the top 4 changes to pay or play for 2016:

Transition Relief Expired: The transition relief which delayed compliance with the pay or play requirements for ALEs with 50 to 99 full-time employees (including FTEs) in 2015 is now expired for employers with calendar year health plans. For ALEs with non-calendar year health plans, this transition relief, along with the transition relief for dependent coverage, continues to apply for any calendar month during the 2015 plan year that falls in 2016.
New Affordability Threshold: If an employee’s share of the premium for employer-provided coverage in 2016 would cost the employee more than 9.66% (formerly 9.56%) of his or her annual household income, the coverage is considered unaffordable to that employee. Employers offering unaffordable coverage may be subject to a pay or play penalty.
Coverage Thresholds Increased: For 2016, ALEs will now be liable for a penalty if they:
- Do not offer health coverage or offer coverage to fewer than 95% (formerly 70%) of their full-time employees (and their dependents), and at least one full-time employee receives a premium tax credit; or
- Offer health coverage to at least 95% (formerly 70%) of their full-time employees (and their dependents), but at least one full-time employee receives a premium tax credit.
Increased Noncompliance Penalties: For 2016, the general annual penalty for ALEs that do not offer coverage or offer coverage to fewer than 95% of their full-time employees (and their dependents) is $2,160 (formerly $2,080) per full-time employee, minus up to 30 full-time employees. For ALEs offering coverage to at least 95% of their full-time employees (and their dependents), the general annual penalty is $3,240 (formerly $3,120) per full-time employee that receives a premium tax credit.

Check out our Pay or Play section for valuable calculators and a toolkit for employers.