When you think of the United States' Affordable Care Act (ACA), many things come to mind. Some see opportunity, while others see limitations. Some see benefits, while others see increased costs. Regardless of the opinion, the ACA has transformed the regulatory environment for many human service organizations, which means these organizations will need to equip themselves with the right tools to comply with these new policies.
This is the first year that organizations must uphold mandatory compliance for ACA reporting and audits, and must offer health insurance to at least 95% of full-time workers if they have more than 100 full-time employees. Monitoring and ensuring ACA compliance can be a complicated process that adds administrative burden, expands compliance costs, and leaves many employees feeling stressed and overwhelmed. As a result, organizations have been compelled to make ACA compliance a top priority in order to avoid accruing fines for non-compliance.
To maintain compliance, organizations are dependent on data from payroll and time tracking. However, many use multiple systems to track their data around hours worked, benefits, and contributions, which creates a situation where data integrity is diluted since the information between systems can be contradictory and inconsistent. Since there is no single source of truth, it is very difficult to gain accurate visibility into an organization’s data, let alone understand whether they are compliant with ACA regulations.
Despite the complexity that ACA presents, there are strategies that organizations can use to ensure that they are compliant. Here are 5 things you can do to make sure your organization is ACA compliant when it comes to reporting:
1. Know where you stand
Organizations need to identify whether they were an applicable large employer — had more than 50 full-time employees — during 2014. If so, then they must issue Form 1095-C to all full-time employees, regardless of whether they are enrolled in the health plan or not, as well as part-time employees who have enrolled.
These forms show the IRS whether your organization offered minimal essential coverage and provide details about the coverage offered, the lowest-cost premium available, and the months when the coverage was available. Ensure that you have written proof – which includes legal and CPA counsel – that determines whether or not you are an applicable large employer, as calculations made from head counts may be erroneous and risk non-compliance.
2. Don't be late
Organizations must distribute statements by Jan. 31, 2017 and submit files to IRS by March 31, 2017. As a result, it is important to start this process as early as possible so that you do not have to scramble at year-end. Organizations can conduct tests to assess their readiness for statement production, printing, and mailing in a short amount of time in order to avoid passing deadlines.
3. Check your records to ensure compliance
Since the threshold is at 95% now, the margin for error with ACA compliance is much lower than it was in previous years. It is very important to have the correct framework and operational and compliance processes in place in order to avoid hefty penalties. Some tips include correctly identifying full-time employees using look-back or monthly methods, and ensuring that plans are affordable for a variety of employees.
4. Seek professional consultation
Consider hiring ACA consultants who have a breadth of experience with ACA rules and regulations and should be able to identify gaps in your ACA reporting process. The investment is worth your time and money since it will allow you to identify flaws in your organization’s existing compliance processes, which can help reduce the potential for being non-compliant or incurring a penalty over the long term.
5. Partner with Altus Dynamics
To make life easier, organizations can turn to payroll and reporting experts such as Altus Dynamics in order to ensure compliance with ACA requirements. Our payroll solution allows you to enjoy a greater level of data accuracy, long-term consistency, and reduced costs. Once you go through the reporting process and solve the problem once, our solution allows you to avoid having to endure the same process in the following years to come.
Furthermore, we allow you to reduce time, manual effort, headaches, and chances of human error through automating the data collection and distribution process for IRS forms and using business rules that determine requirements and coverage. Above all else, our comprehensive solution has the ability to amalgamate complex data from different sources, consolidate the data, determine employee coverage, and ensure accuracy of the data for reporting purposes.
The ACA has brought with it a set of new policies that changes the way organizations manage payroll and reporting. As a result, it is crucial for organizations to be diligent about evolving their compliance processes in order to keep up with this changing regulatory landscape. Teaming up with experts such as Altus Dynamics to manage your payroll and reporting is an excellent way to ensure that you are ACA compliant.
To learn more about how Altus Dynamics’ payroll and reporting capabilities will reduce the headache of ensuring ACA compliance, request your free demo of our solution today.