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IRS’ 2024 'affordable' health plan threshold: Employers may need to lower premiums

For employers that set their employee premium costs last year right at the ACA affordability threshold, their plans will no longer be affordable if they charge employees the same amount in 2024 as they did in 2023.

By Alan Goforth | September 13, 2023 at 11:43 AM
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Employers could take on added shared responsibility for the health care of some workers next year, since the IRS has announced that the new 2024 health plan affordability threshold – used to determine if an employer’s lowest premium health plan meets the Affordable Care Act’s affordability requirement – will be lowered to 8.39% of an employee’s household income for 2024.

The ACA benchmark for determining the affordability of employer-sponsored health coverage will drop significantly for the new plan year, down from the 2023 plan year level of 9.12%. This affordability percentage can affect individuals’ eligibility for federally subsidized coverage from a public exchange, as well as employers’ potential liability for shared responsibility assessments.

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