Minimum Essential Coverage for Health Care

From: Staffing

Minimum Essential Coverage for Health Care

Minimum Essential Coverage (MEC)

Minimum essential coverage (MEC) means and includes the following types of health care coverage:

  • Employer-sponsored coverage (including self-funded [self-insured] plans, COBRA coverage, retiree coverage, or coverage under an expatriate health plan for employees).
  • Coverage purchased in the individual market, including insurance purchased directly from an insurance company, a qualified health plan offered by the Health Insurance Marketplace, insurance provided through a student health plan, catastrophic plan, and coverage under an expatriate health plan such as for students and missionaries.
  • Governmental plan coverage, such as the Federal Employees Health Benefit program.
  • Medicare Part A coverage and Medicare Advantage plans.
  • Most Medicaid coverage.
  • Children’s Health Insurance Program (CHIP) coverage.
  • Comprehensive health care programs offered by the Department of Veterans Affairs.
  • Most types of TRICARE coverage.
  • Health coverage provided to Peace Corps volunteers.
  • Department of Defense Nonappropriated Fund Health Benefits Program.
  • Refugee Medical Assistance supported by the Administration for Children and Families.
  • Coverage through a Basic Health Program (BHP).
  • Self-funded health coverage offered to students by universities for plan or policy years that begin on or before December 31, 2014 (for later plan or policy years, sponsors of these programs may apply to the Department of Health and Human Services (HHS) to be recognized as minimum essential coverage).
  • State high risk pool coverage established on or before November 26, 2014 in any state.
  • Certain foreign coverage.
  • Other coverage recognized by the Secretary of HHS as minimum essential coverage.

MEC does not include:

  • Coverage providing only limited benefits (such as dental- or vision-only coverage).
  • Workers’ compensation or accident or disability policies.
  • Medicaid providing only family planning services, Medicaid providing only tuberculosis-related services, or Medicaid providing only coverage limited to treatment of emergency medical conditions.
  • Medicaid programs such as pregnancy-related coverage, medically-needy coverage, or § 1115 demonstration projects. (See IRS Notice 2014-10 for relief from tax penalty.)
  • Space-available TRICARE coverage or line of duty TRICARE coverage. (See IRS Notice 2014-10 for relief from tax penalty.)
  • Certain types of coverage through AmeriCorps or AfterCorps.

Caution: Minimum essential coverage (MEC) is not the same as essential health benefits (EHBs). MEC is health care coverage that satisfies the Affordable Care Act’s individual mandate (requirement for individuals to maintain minimum coverage to avoid potential tax penalty).

Official Guidance:

The federal departments provide regulatory guidance on this topic in the following material:

IRS Publication 974 “Premium Tax Credit”: click here.

Department of Health & Human Services “Minimum Essential Coverage”: click here.