Healthcare.gov defines Minimum Value as a standard of minimum coverage that applies to job-based health plans. If your employer’s plan meets this standard and is considered “affordable,” you won’t be eligible for a premium tax credit if you buy a Marketplace insurance plan instead. The standard is if both of these apply”
⦁ The plan is designed to pay at least 60% of the total cost of medical services for a standard population
⦁ The plan’s benefits include substantial coverage of physician and inpatient hospital services
*Providers via a Third Party Actuary (TPA) generally must use a Minimum Value Calculator developed by Health and Human Services to determine if a plan with standard features provides minimum value.
Not all plans offer Minimum Value, so it’s important to be aware of some other options available to employers.
⦁ Preventative Care
⦁ Shots, screening tests and other preventative services are provided at no expense to the employee
⦁ Minimal Essential Coverage
⦁ Any insurance plan that meets the Affordable Care Act requirement for having health coverage
⦁ Also called “qualifying health coverage”
⦁ Bare minimum to comply with the individual mandate
*In reference to the Affordable Care Act, anything less than Minimal Essential Coverage means no coverage
However, employers can choose to minimize their risk and potential exposure to penalties by offering some sort of qualified plan, such as Minimal Essential Coverage.
Now, referenced in another lesson, we’ll see that only offering MEC is not a “get out of jail free” card for employers, they may choose to offer a higher standard, one that qualifies as Minimum Value. Please keep in mind that if a health plan provides MV, it also meets the requirements and encompasses MEC requirements.