8861 / Will an employer be subject to the ACA shared responsibility provisions if it offers employees and their dependents coverage that is both affordable and provides minimum value, but some of its employees, their spouses and/or dependents obtain coverage through the health insurance marketplace, Medicaid or Medicare?

The employer will not be subject to the shared responsibility payment unless one of its employees receives a premium tax credit.¹ If the employer offers coverage that is both affordable and provides minimum value to employees and their dependents, neither the employees nor their dependents will be eligible for the premium tax credit if they elect to purchase insurance through the exchanges. Employees (or dependents) who are eligible for Medicare or Medicaid are not eligible for a premium tax credit.²

1. IRC § 4980H(a).

2. See Preamble to the Final Regulations, TD 9655.