Benefits Blog: ACA Affordability Percentages Down for 2022

The federal Affordable Care Act (ACA), through Internal Revenue Service (IRS) guidelines, has adjusted its affordability percentages downward in 2022, meaning that employers may need to change some of their employee contribution levels.

On August 20, 2021, the IRS issued Revenue Procedure 2021-36 to index the contribution percentages in 2022 for determining affordability of an employer’s plan under the ACA.

For plan years beginning in 2022, employer-sponsored coverage will be considered affordable if the employee’s required contributions for self-only coverage does not exceed the following:

  • 61% of the employee’s household income for the year for purposes of both the pay-or-play rules and premium tax credit eligibility; and
  • 09% of the employee’s household income for the year for purposes of an individual mandate exemption (adjusted under separate guidance). Although this penalty was reduced to zero in 2019, some individuals may need to claim an exemption for other purposes.

The updated affordability percentages are effective for taxable years and plan years beginning on Jan. 1, 2022.

This is a significant decrease from the affordability contribution percentages for 2021, which had been set at 9.83% and 8.27%.  As a result, some employers may have to lower their employee contributions for 2022 to meet the adjusted percentage.

Under the ACA, the affordability of an employer’s plan may be assessed in the following three contexts:

  • The employer shared responsibility penalty for applicable large employers (also known as the pay-or-play rules, or employer mandate).
  • An exemption from the individual mandate tax penalty for individuals who fail to obtain health coverage.
  • The premium tax credit for low-income individuals to purchase health coverage through an Exchange.

Although all of these provisions involved an affordability determination, the test for determining a plan’s affordability varies for each provision.

Understand where your organization falls within these ACA guidelines.  Contact the Benefits Team at The Reschini Group for more information.


Copyright 2022 The Reschini Group

The Reschini Group provides these updates for information only, and does not provide legal advice.  To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.

Benefits Blog: Protecting Your Online Identity

When are you not you?

When hackers and other malicious parties steal your identity online, that’s when.  Identity theft occurs when others obtain and use your personal information without your permission.  Once this information has been acquired, thieves can use your existing credit cards or open new ones in your name, write bad checks, take out loans, and generally ruin your credit and reputation.

Once the theft has been spotted and reported, significant damage may – and most likely will – have been done.

Beyond taking the obvious precautions, another way to safeguard yourself from the impact of identity theft is to secure the proper identity theft insurance coverage.

Identity theft insurance can be purchased as a standalone policy or added as endorsement to existing homeowners or automobile insurance coverage.  Even though identity theft insurance does not protect against the cost of the actual theft, it offers a relatively inexpensive option that will cover the cost of reclaiming your identity, to include such items as:

  • Phone call charges, photocopying costs, and postage fees.
  • Salary loss due to uncompensated time off from work.
  • Legal fees.

Another attractive feature of this special coverage is that you can gain access to a fraud specialist who can provide valuable assistance in restoring your good name and protecting your identity.  This service is part of the reimbursement offer for expenses associated with credit restoration, as well.

Make sure you are always you.  Protect yourself from identity theft and the financial fallout it wreaks.  Contact the Benefits Team at The Reschini Group for more information.


Copyright 2022 The Reschini Group

The Reschini Group provides these updates for information only, and does not provide legal advice.  To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.