Over the years, we have heard many questions about how ACA relates to COBRA retirees. Below we have addressed some of the most common COBRA retiree 1095-C form questions.
Are we responsible for reporting COBRA coverage when it is outsourced?
If you are a fully insured employer, your insurer or plan sponsor is responsible for reporting COBRA coverage under section 6055. If you are a self-insured employer, you are responsible for reporting COBRA coverage under section 6055, even if you use a TPA for your COBRA administration.
What are the 1095-C COBRA codes for retirees?
For Part II of form 1095-C, line 14, code 1G would be used for COBRA beneficiaries if they have been enrolled for the entire year. If they retire mid-year, they will receive code 1H/2A with coverage showing in Part III for the months they are on COBRA. Lines 15 and 16 are not required.
Do you have to report for individuals who are on COBRA? If so, what premium amount should be used since they pay 100% of the premium?
If you are a self-insured employer, you must complete section 6055 reporting for anyone enrolled in your COBRA coverage. If using form 1095-C for COBRA reporting, you would enter codes 1G and 2A in part II lines 14 and 16, respectively. Line 15 is not required as affordability is not assessed for COBRA individuals.
Do retirees who receive health insurance benefits need form 1095-C since they are not working?
If you are a self-insured employer, section 6055 reporting is required for both retirees and COBRA participants, and the forms used for this reporting (either forms 1094 and 1095-B or form 1095-C) must be furnished to the IRS and the individuals.
We were told by an employment law firm that COBRA/retirees had to report on a 1095-C for when they were active, but if they continued coverage, you would use a 1095-B form as the entity that offered the MEC.
That is correct. If you are a self-insured employer offering COBRA/retiree coverage, you have the option to use either form 1095-B or form 1095-C for reporting their COBRA/retiree coverage as the entity providing MEC.
Is reporting for COBRA and retirees optional?
COBRA/retiree coverage for self-insured employees is required, with the option to use form 1095-B or form 1095-C for reporting.
What are the ACA forms that I need to fill out for COBRA/retiree coverage?
Forms 1095-B are to be filled out and provided by the Insurance carrier if you are on a fully insured plan. Form 1095-C should be filled out if you are on a self-insured plan, by you, the employer.
To view the forms and instructions for filling them out follow the links below:
- Form 1094-B
- Form 1095-B
- Form 1094-C
- Form 1095-C
- Instructions for filling out 1094-B and 1095-B
- Instructions for filling out 1094-C and 1095-C
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The information provided does not, and is not intended to, constitute legal advice; instead, all information and content herein is provided for general informational purposes only and may not constitute the most up-to-date legal or other information.
