'Minimum value' health care plan rules forthcoming

WASHINGTON—The Internal Revenue Service will develop rules to give employers several ways to prove that their health care plans provide “minimum value” to enrollees.

Under the Patient Protection and Affordable Care Act, plans must have a minimum value to escape financial penalties. To meet the minimum value test, a plan must cover 60% of the “total allowed costs of benefits provided under the plan,” according to the PPACA.

The IRS said it will develop a variety of design-based safe harbors in the form of checklists to provide “a single straightforward way” for employers to determine if their plans meet the minimum value threshold “without the need to perform any calculations” or use an actuary.

The IRS said it will develop a “minimum value calculator” in which employers would enter information about plan benefits, coverage of services and cost sharing to determine if the plan provides minimum value. It also said for plans with “nonstandard features” that would preclude the use of a minimum-value calculator without adjustments that an employer could seek “appropriate certification” from an actuary that the plan provides minimum value in accordance with recognized actuarial standards and other conditions the IRS would provide in future guidance.