Under health care reform, which scenario triggers penalties for employers with 50+ employees?

• A. Penalties apply to employers with 50+ employees if they do not provide health insurance and one or more employees purchase coverage in state exchanges
• B. Penalties apply to employers with 50+ employees if they provide health insurance and no one purchases exchange coverage
• C. Penalties apply to employers with 25 employees if they do not offer any health coverage
• D. No penalties for any employer regardless of size

Answer: (A)

Large employers (50 or more full‑time equivalent employees) must offer affordable, minimum‑value health coverage. A penalty is triggered when they fail to offer such coverage and at least one employee receives a premium tax credit to buy coverage on the state (or federal) exchange. In this scenario, not providing insurance and at least one employee purchasing exchange coverage with a subsidy shows the employer did not meet the requirement, so penalties apply. If coverage is offered and no one uses exchange coverage, there’s no penalty under this rule. The other options describe conditions that don’t meet the penalty trigger.