As certain triggers of the Affordable Care Act (ACA) are being phased in, employers are experiencing new administrative complexities with respect to employee health care plans. The ACA brings with it requirements for tracking employee hours and government filings; there’s also a considerable increase in the risks for employer liability. There are varying timetables applicable to companies based on number of employees, with full implementation expected across the board by 2018. As such, there are a few areas where real time reporting will be critical for employers.
W-2 Reporting: Employers must start monitoring the number of W-2s they issue to qualifying employees. The ACA requires that companies producing more than 250 W-2s under applicable tax laws will have to calculate total employer and employee health insurance premium costs, which must also be reported on the W-2.
Enrollment Waiting Periods: As of the 2015 calendar year, employers cannot require eligible employees to wait more than 90 days before their health care enrollment period starts. The enrollment waiting period starts on the day of hire; birth or marriage are also life events that start the clock. Benefits administration solutions must include real time reporting capabilities to support this requirement.
Full-time v. Part-time Employees: Another ACA requirement makes real time reporting a vital feature for workforce management systems: Distinguishing between full-time and part-time employees.
- Standard Measurement Period: This period specifies the full-time/part-time difference for purposes of an employee’s eligibility for health insurance. Employers have a few options in choosing the standard measurement – anywhere between 3-12 months; they also have flexibility in determining when the measurement period starts and ends, so long as the calculation is consistent for all workers in the same employee category.
- Stability Period: Employees that average a minimum of 30 hours per week during this time period will be eligible for health insurance coverage during the subsequent stability period. This time limitation must be equal or longer in duration than the measurement period, but cannot be shorter than six months.
- Other Reporting Periods: New hires will be subject to a measurement period and current employees are always measured for FT/PT hourly purposes; plus, there are rules regarding temporary workers and re-hired employees. Those companies with variable-hour scheduling for some or all of their workforce will find themselves inundated with reporting tasks, as will businesses with high turnover.
As you can see, ACA compliance requires employers to measure each employee for purposes of health insurance coverage on an ongoing basis. There will be a constant cycle of measurement and stability periods, during which different employees are entering and exiting the eligibility standards. The entire system must be tracked carefully, putting HR solutions with real time reporting features at the forefront for employers.
Many of these new regulations may seem cumbersome from a compliance standpoint, but companies that engage in advance planning and partner with the right solutions provider are set up for success.
Paypro offers an array of tools that enable real time reporting, thereby meeting ACA requirements. To learn more on how we can help with ACA reporting, please contact us to request a consultation with one of our workforce management experts.