ACA Affordability Analysis

ACA Affordability Analysis

This analysis will assess the current cost of the client’s plan designs against the IRC Section 4980H(b) Affordability provision under the Employer Mandate regulations of ACA. The review will also include the recent guidance on flex credit, opt out and cash in lieu provisions. We will provide a summary of plan options and employee salary or hourly rate levels that may be at risk for triggering the Affordability penalties under ACA and provide strategies to eliminate or mitigate the risk of penalties under the law.

Service Features:

  • Review benefit plans, contributions, and eligibility requirements.
  • Collect census and enrollment information / utilization by plan.
  • Review IRC Section 4980H(b) regulations.
  • Conduct affordability analysis by lowest cost plan offerings to groups of employees using Rate of Pay and Federal Poverty Level safe harbors.
  • Discuss any flex credit, opt-out / cash in lieu provisions.
  • Determine salary levels and hourly rates by employment class /plan offering that could create affordability concerns.


  • Report summarizing analysis by employment class / lowest cost plan offering.
  • Review of options to mitigate risk of affordability concerns.
  • Includes 2-hour meeting with client to review results.

Neither American Fidelity Assurance Company nor American Fidelity Administrative Services provides tax or legal advice and, given the complexity of these laws, we always recommend working with your legal counsel on how the laws impact your specific situation.