As background, applicable large employers (“ALEs”) may be subject to the Employer Penalty if any full-time employee (“FTE”) receives a subsidy to purchase Exchange coverage. There are two penalties, “A” and “B.” The “B” Penalty can apply when the ALE offers at least 95% of FTEs and their dependent children minimum essential coverage (“MEC”) but the coverage is not affordable, does not provide minimum value, or excludes 5% or fewer FTEs.
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