The Affordable Care Act has dramatically changed the face of health care for small businesses. While the ACA impact will vary based on the size of your business, staying compliant with changing regulations presents a daunting challenge to your HR staff, as well as your company’s bottom line. While you may still be working on your filings from 2015, an important question lingers: Have you chosen a strategy for 2016?
Employer Shared Responsibility (ESR) provisions will be changing in 2016. In 2015, an employer could avoid having to make an ESR penalty payment they were providing minimal essential coverage for 70% of its employees and dependents. In 2016, the coverage required will increase to 95%
For further information on how the IRS defines minimal essential coverage, click here
These penalties will also become more costly in 2016. While 2015 allowed the number of full time employees to be reduced by 80 before calculating the penalty, this number can only be reduced by 30 in 2016. This penalty could exceed $2,000 for each FTE above these number.
Reporting penalties will also become a focal point. For 2015 reporting, many expect that the IRS will not impose penalties for reporting incorrect or incomplete information, if the employer is able to prove it made good-faith efforts and achieved timely filing. The recent filing extensions have been helpful in this regard. However, in 2016 this leniency will likely go away, and the penalties could carry a $250 fine per incorrect form.
One key aspect of choosing how your company will handle the ACA will be having the tools necessary to proactively manage your compliance strategy across your workforce. Our ACA module allows your business to simplify the processes around ACA compliance to help avoid these steep penalties. By combining your payroll, benefit management, and hours tracked into one solitary solution, you can have access to the following features:
Access to both real-time and historical data on ACA measurements
Compliance alerts to notify mangers or HR staff when an employee’s status changes from full-time to part-time, when an employee is approaching eligibility, and when an employee has scheduled hours to put them over the eligibility limit
Alerts can also be sent to employees to notify them when they are eligible for benefits, and allow them to automate enrollment through self-service
Management dashboards provide consolidated views of regular and variable-hour labor pools
For more information on how APS can help you manage your ACA strategy, while reducing your administrative costs, call 844-299-2358 or visit us at www.apsanswers.com.