Overview of the situation In general, all U.S. citizens, regardless of expatriate assignment location, along with foreign nationals who are living or working legally in the United States, must have medical cover that meets the requirements for minimum essential coverage (‘MEC’). Any individual who cannot provide proof of MEC will incur a tax penalty. An individual resident outside the US is deemed to have MEC if tax residency is outside the US subject to certain conditions.
Insured plans issued in the US and self-funded coverage providing medical coverage beyond certain limited or excepted benefits such as dental - or vision - only coverage count as MEC.
Also, with regard to expatriate medical plans, if the plan is insured under policies issued and regulated outside of the US, the plan qualifies as MEC if the benefits at least meet the minimum standards and they meet the certain conditions.
Applicable large employers must provide individuals and the IRS with information about full-time employees (averaging 30 hours or more per week), terms of offers of any coverage including whether coverage has at least the minimum value, and its affordability status. This first applies to 2015 data with reporting due in 2016. The same deadlines for providing individual statements and IRS filings apply as for MEC reporting. Employers file on IRS Forms 1094-Cs (transmittal form) and 1095-Cs (individual statements). For employers sponsoring self-funded plans, MEC reporting is included on these forms.
Note that US health care reform and other federal law raise further potential compliance issues, including the question of whether expatriate medical coverage is subject to US plan design rules and - if so - whether these have been satisfied, and also whether coverage is subject to federal continuation coverage rules (e.g. COBRA).
The increasing compliance risk associated with healthcare insurance for expats (together with a desire to ensure equality of coverage between expats from different countries) is pushing many corporates towards introducing standard solutions globally for their expat populations. Mercer is ideally placed to assist our members select the most appropriate global coverage for healthcare as well as other risk insurance (death/disability) and for retirement savings.
Mercer Marsh Benefits specialists offer consultancy in design, negotiation and implementation of medical and other insurances for expatriates. Please contact
daniela.coman@marsh.com (
+4 0730 591 132
+4 0730 591 132) or your usual Mercer Marsh Benefits consultant if you require further details, or would like to discuss any points.
About MercerMercer is a global leader in talent, health, retirement, and investments. Mercer helps clients around the world advance the health, wealth, and performance of their most vital asset – their people. Mercer’s more than 20,000 employees are based in 43 countries and the firm operates in more than 130 countries. Mercer is a wholly owned subsidiary of
Marsh & McLennan Companies (NYSE: MMC), a global team of professional services companies offering clients advice and solutions in the areas of risk, strategy, and human capital. With over 55,000 employees worldwide and annual revenue exceeding $12 billion, Marsh & McLennan Companies is also the parent company of
Marsh, a global leader in insurance broking and risk management; Guy Carpenter, a global leader in providing risk and reinsurance intermediary services; and Oliver Wyman, a global leader in management consulting. For more information, visit
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About Mercer Marsh Benefits Mercer Marsh Benefits provides clients with a single source for managing the costs, people risks, and complexities of employee benefits. The network is a combination of Mercer and Marsh local offices around the world, plus country correspondents who have been selected based on specific criteria. Our benefits experts located in 135 countries and servicing clients in more than 150 countries, are deeply knowledgeable about their local markets. Through our locally established businesses, we have a unique common platform which allows us to serve clients with global consistency and locally unique solutions.
