Does My Employer Group Health Plan Meet Healthcare Reform’s Minimum Value Requirements?

On February 20, 2013, the United States Department of Health and Human Services released the much anticipated minimum value calculator.  This tool is designed to allow both insurance carriers and employers determine plan designs that meet the Affordable Care Act’s minimum value requirement.  Under the Employer Shared Responsibility provisions of the Affordable Care Act, an employer sponsored group health plan must meet certain requirements for affordability and minimum value.  Minimum value means that the plan’s share of the total cost of benefits is at least 60%.  This does not mean that the employer must contribute at least 60% of the cost of the premium.  This requirement refers to the actual share of the total cost of a claim that the plan must pay.

Why is this calculator so important? If an employer’s group health plan does not meet these requirements, the employer could get hit with a $3,000 penalty for each full time employee that buys subsidized health insurance coverage through a health insurance exchange.  This tool will help employers to understand one piece of the healthcare reform puzzle and to see how their current benefit plans stack up against the minimum value requirement.

To learn more about the minimum value calculator and its methodology, click here.  Be sure to click “Minimum Value Calculator” or “Minimum Value Calculator Methodology” under the “Plan Management” heading.

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