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ACA Reporting Requirements are Coming…Are You Ready?

Amanda Hagerty
Reading time 2 Mins
Published on Jul 28
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The Affordable Care Act (ACA) is the biggest healthcare change in over 100 years. Without comprehensive data integration between these systems, it will become increasingly more difficult to maintain compliance.

The ACA reporting and compliance requirements affect companies with 50 or more full-time or full-time equivalent employees. Full-time status is defined as 30 or more hours of service per week. Here are three requirements of the ACA that put employers at high risk of noncompliance. Each of these carry data sharing challenges. With proper planning, management, and reporting you can avoid facing thousands of dollars in fines and penalties.

 SHARED RESPONSIBILITY EXCISE PENALTY:

The Shared Responsibility Mandate requires an employer to offer full-time employees a medical benefit that meets the ACA minimum essential coverage requirement, and is affordable to full-time employees. Otherwise, the employer is subject to a non-deductible $2,000 excise penalty per each full-time employee, sometimes referred to as the “Catastrophic” penalty.

THE “LESSER” EXCISE PENALTY:

  • The Individual Mandate requires all individuals obtain health insurance or pay a penalty. The employee can be penalized should they receive a subsidized premium when their employer meets all ACA guidelines.
  • “Lesser” penalty requires that all employers offer employees an affordable health plan with at least a 60% minimum value.
  • To be considered affordable, the employee’s share of the premiums for an “employee only” plan cannot cost the employee more than 9.5% of annual wages.

2016 REPORTING REQUIREMENTS:

  • The ACA requires employers to report information to the IRS under Internal Revenue Code (IRC) Section 6056. Reporting for 2015 is required and begins inJanuary 2016. The deadline for reporting to the IRS is Feb. 28 after the end of theyear for which the return is being filed, or March 31 if the return is filedelectronically.
  • Statements will be provided to full-time employees using form 1095-C or other form specified by the IRS. The employee information will be transmitted to the IRS using form 1094-C or other form specified by the IRS.
  • ALE members may be penalized for failing to file correct returns and for failing to provide responsible individuals and full-time employees with accurate statements.

The key to ensuring compliance with ACA regulations and reducing the financial risks involved is utilizing a fully integrated system. Through comprehensive, detailed, accurate and timely integration of information employers will be able to ensure compliance and adequately document, record and report compliance status, in turn avoiding the risk of high penalties.


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