With the Affordable Care Act (ACA or Obamacare) now in full effect, employers and their health insurance advisers are adapting to a “new normal.” And while 2014 and 2015 have been the years of new rules and regulations, 2016 will be the year of compliance and reporting.
As employers gear up for the year ahead, here are four Obamacare compliance issues you shouldn’t ignore.
1. Employer Shared Responsibility
The Employer Shared Responsibility provision, also called ESR or the employer mandate, is the requirement for applicable large employers (ALEs) to either offer health insurance to employees, or pay a fee if/when an employee buys subsidized health insurance through the Marketplace.
All employers need to understand:
Does this provision apply to us? (Are we an applicable large employer with 50+ FTEs?)
If we offer coverage, does our health insurance plan satisfy the affordability and coverage requirements?
If we do not offer coverage that satisfies the mandate, what are the fees we could pay?
How does the transition relief impact our coverage requirements and reporting for 2015?
2. Annual Healthcare Reporting
In addition to the Employer Shared Responsibility, ALEs need to understand new healthcare reporting requirements required under health reform law. Starting in January 2016, all ALEs are required to submit IRS Form 1095-C and Form 1094-C.
ALEs need to understand the new reporting requirements and be prepared to report on the following information:
Basic employer information.
The months during the calendar year for which healthcare coverage was available.
The number of full-time employees for each month during the calendar year.
Whether you, the employer, offered full-time employees and their dependents the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan (by calendar month).
Each full-time employee's share of the lowest-cost monthly premium (self-coverage only) for coverage providing minimum value under an eligible employer-sponsored plan (by calendar month).
The name, address, and taxpayer identification number (TIN) of each full-time employee covered under any such health benefits plans.
For some employers, this information is straight-forward. For others, the reporting requirements are time consuming and complex. To help ease the administrative pain, numerous ACA compliance software platforms have popped up in the market to help employers accurately track, integrate, and report personnel and benefit information required for the new healthcare reporting.
3. Exchange Notice Management
All employers, regardless of size or benefits offered, are required to provide employees notices of coverage available through the public Health Insurance Marketplaces.
All employers should verify they are meeting the Exchange (“Marketplace”) notice requirements, as well as other health plan notice requirements.
4. Benefits Plan Structure
Under the ACA, there are several new rules about benefits plan structure and coverage. Most of the reforms went into effect in 2014 or 2015, but fees for non-compliance are steep.
To ensure compliance, employers offering health benefits should audit their plans annually to ensure compliance with group health plan reforms, such as:
Preventive Care Services Requirements
90 Day Limitation on Waiting Periods
Essential Health Benefit Rules
Health Plan Notice Requirements
Tip - These are just some of the most common health plan reforms. Check with your insurance professional, health benefits company, or ACA compliance software provider for all reforms applicable to your health plans.
As employers prepare for the year of ACA reporting and compliance, Employer Shared Responsibility, healthcare reporting, notice management, and benefit plan structure should be top of mind.
What else is top of mind to your business or your clients? Leave a comment or question below.