Enacted in March 2010, the Patient Protection and Affordable Care Act (today commonly referred to as the “ACA” or “Obamacare”), has dramatically changed health care delivery. The difficultly of ACA is that it afffects all businesses differently. Applicable rules for managing ACA depend on a number of factors including the size of the business, the ownership structure, employee compensation, employee notices and communication, benefit plan structure and cost, and employer contriibution.
Of course, once applicability is determined, maintenance is required. If the business grows or shrinks, the requirements change. In short, ACA is a very complex piece of legislation and very few organizations are adequately staffed with competent employees, nor do they maintain systems sophisticated enough to navigate the rules and meet government requirements. Luckily for Advanstaff HR clients, we have both. A robust, integrated system, with acess to all the necessary data to determine exposure and compliance, and dedicated professionals to protect our customers from the pitfalls of non-compliance and the severe penalties associated with not meeting the mandatory government requirements.
We cannot stress enough the importance of understanding this law and how it applies to your company. The penalties of non-compliance are enough to put companies out of business. We at Advanstaff HR are committed to making sure that you not only avoid that risk, but don’t even have to think about it.
Though there are far too many variables to explain on a web page exactly how ACA will affect you company, here is a snapshot of the requirements and how Advanstaff HR ensures our client companies remain in compliance.
Make sure your data is accurate and complete with this report. Verify that anyone categorized as a full-time employee truly is working enough hours to be categorized as such. Analyze and verify your data so you can make any adjustments before running the large employer test.
A “large employer” averages at least 50 full-time equivalent employees for the previous calendar year. HRPyramid’s Large Employer Test report lets you easily analyze this information for any employer, and any date range, so you can make predictions and understand where each company stands.
Some variable-hour employees are eligible for coverage under the ACA if they work an average of 130+ hours per month over a 6-12 month time period (established per client). This HRPyramid report lets you set a custom time-frame and quickly see if there are part-time employees who are eligible for coverage under the ACA.
According to the ACA, to be affordable the employee’s cost of the employee-only coverage of the lowest-cost ACA-compliant plan available to that employee must be 9.5 percent or less of annual household income. Regulations allow three safe harbor options to use in lieu of the annual household income. Those three options are: Annualized Pay, the box-1 W-2 wages, or federal poverty level (FPL). HRPyramid’s Affordability Test report displays Annualized Pay and box-1 W-2 calculations for employee’s currently elected health plan, so the employer can decide which form of “wages” will determine affordability.
The Family Rated Plan option provides that the premium rate charged by a health insurance issuer for non-grandfathered coverage in the individual or small group market may vary by age and a tobacco use surcharge. Manually calculating coverage for this plan can be tedious and time consuming, but HRPyramid automatically recalculates these rates each pay cycle based on data in the system. The rate per covered person is based on the number of covered family members (a maximum of three children under age 21 can be counted in this plan), their ages, and if they are tobacco users.
Users can run one report to show which clients are eligible for this credit. Once identified, users can run a second report at the client-level to discover how much that credit is worth.