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MA 1099-HC Requirements


Background

The 1099-HC requirement stems from the MA Health Care Reform Act which requires the following of employers:

 

  • Make a Fair Share Contribution – Employers who do not make a fair and reasonable contribution to health insurance coverage are subject to a fine of up to $295 per employee per year. The Commonwealth's Division of Unemployment Assistance has more information on this calculation.
  • Set Up a "Cafeteria Plan" for Employees – A cafeteria plan allows employees to pay for insurance premiums on a pre-tax basis. If an employer does not set up this plan, and if an employee or a dependent receives publicly funded health services, then the employer may be subject to a "Free Rider Surcharge." The Commonwealth Health Insurance Connector has more information on this requirement.
  • File the Fair Share Contribution and Health Insurance Responsibility Disclosure Reports – Employers are to make a combined online filing with the Division of Unemployment Assistance. This combined filing satisfies the requirement for the two reports. The submission is due quarterly.
  • Retain Employee Health Insurance Responsibility Disclosure (HIRD) Forms – Employees who do not accept their employers' coverage are required to complete an Employee HIRD, which the employer keeps for three years. This enables compliant employers to avoid liability for the Free Rider Surcharge and the Fair Share Contribution penalty.
  • Provide Employees and the Commonwealth of Massachusetts with Proof of Coverage – Employers must provide their enrolled employees who reside in Massachusetts with proof of coverage via a 1099-HC.

Meritain Assistance with compliance

Meritain produces the 1099-HC to assist employees with providing Proof of Insurance Coverage.

 

When the 1099-HC form is produced

The 1099-HC Form must be produced no later than January 31st of each calendar year.

 

Purpose of the 1099-HC

1099-HC Form serves as proof of health insurance coverage for Massachusetts residents age 18 and older when completing their Massachusetts state income tax filing.

 

Penalties

Failure to prepare and file the 1099 HC to the MA Department of Revenue could subject the employer or carrier to penalties, including but not limited to a penalty of $50 per individual to which the failure relates, not to exceed $50,000 per year per violator.

 

This content is being provided as an informational tool. It is believed to be accurate at the time of posting and is subject to change. It is recommended that plans consult with their own experts or counsel to review all applicable federal and state legal requirements that may apply to their group health plan. By providing this information, Meritain Health is not exercising discretionary authority or assuming a plan fiduciary role, nor is Meritain Health providing legal advice.