Companies with fewer than 100 employees who think they don’t have to worry about the Affordable Care Act until 2016 “missed the fine print,” says an article in the Los Angeles Business Journal which cites advice from Robert Sheen, Editor of the ACA Times and President of First Capitol Consulting, Inc.
In 2016, employers with just 50 or more workers will have to report to the Internal Revenue Service whether they offered health insurance to those workers this year, and provide required statements to each of their employees.
“Sound simple? It’s not,” writes Business Journal reporter Marni Usheroff. “The process involves matching up human resources and benefits data on a monthly basis – for every employee.”
Sheen told Usheroff that failure to file information correctly with the IRS can trigger penalties of $100 per employee. That means companies should already be tracking information about each of their employees now, rather than until waiting next year. That information can range from birth dates, union status, date hired (and terminated) and worked each week, to the dates the employer distributed of information to each worker about company-sponsored health insurance.
“The big challenge we see right now is a company needs to marry these data that meet this Internal Revenue Code requirement,” said Robert Sheen. “They can’t keep it all separate and at the end of January try to put certain data from different departments into one source.”
Sheen points out that the IRS will match company records about each employee’s insurance against the data from online marketplaces or exchanges, where individual who purchase may obtain a subsidy to help cover their premium cost. If an employee receives a subsidy for insurance the company should have provided, the IRS may impose penalties on the employer.
The Business Journal quotes Kevin Kuhlman, director of federal public policy for the National Federation Independent Business, who pointed out that health insurance offered by companies must provide adequate coverage, including benefits specified by the ACA, and must be affordable, meaning the cost to employees does not exceed a specified percentage of their income.
“There’s a lot of different factors to streamline,” Kuhlman told the reporter. “You might be talking to an accountant income and to a health insurance broker on health insurance information. That’s why I think it is important for employers to get a system in place now before scrambling on this next spring.”
Sheen said his staff is already working hard to ensure that Trusaic clients comply with the detailed requirements of the ACA. “Some of my guys working to get the data in the right format have been staying until 1 o’clock, 2 o’clock in the morning or overnight,” he said.
