Under the Affordable Care Act (ACA), employers that issue 250 or more W-2 forms must report the cost of employer-sponsored group health plan coverage on those forms. The IRS provides additional details and FAQs on its website. Importantly, the IRS has emphasized that this reporting is for informational purposes only. It does not affect taxable income or any other amounts reported on Form W-2. The intent is to give employees “useful and comparable consumer information” about the cost of their health coverage (Internal Revenue Bulletin No. 2012-4, Jan. 23, 2012).
W-2 Reporting: Box 12
The cost of the health care coverage should be reported in Box 12, using Code DD. This amount is not taxable to the employee. Employers issuing fewer than 250 W-2 forms are not required to report this information but may do so voluntarily.
W-2 Report Available on Employer Portal
To support your ACA reporting, MedCost provides a W-2 report through the secure MedCost Employer Portal. Reports are automatically generated for plans regardless of the number of covered employees.
Each report includes:
- All employees covered during the 2025 calendar year
- The calculated cost of each employee’s health care coverage, based on the applicable plan option and coverage tier
(For questions about allocation rates, please contact your MedCost Account Manager.)
This report also reflects:
- New hires covered for only part of the year
- Mid-year changes, such as plan option or tier changes
- Former employees who remained covered as COBRA participants or retirees
When Will the W-2 Report Be Available on the Employer Portal?
The report will be posted on the MedCost Employer Portal by January 9, 2026, in a folder titled “W-2 Reporting.”
As a reminder, employers must file W-2 forms and provide them to employees by January 31, 2026.
Important Note
The MedCost W-2 report includes only the plans administered by MedCost. You are responsible for incorporating information from any other applicable benefit plans not administered by MedCost. If your group transitioned to MedCost during 2025, you must supplement this report with cost data from your previous administrator for the months prior to the transition.
MedCost is here to assist you with ACA reporting requirements. If you have questions or need further assistance, please contact your MedCost Account Manager.