How Employers are Complying with the Affordable Care Act
Employers that are facing the effects of the Affordable Care Act have been given a few years to prepare for the requirements of the law. There is one factor to look at. This is the preparation of any given organization to comply.
Organizations Are Surveyed
In an attempt to help organizations understand the ACA effect on U.S. employers, the employers and HR executives have been surveyed. The results provide insights on what the organizations are doing for compliance to the ACA. They also show what organizations are not doing.
The Person in Charge of Compliance
One would think a team is used to handle the ACA compliance. However, according to the survey, large corporations are leaving it to people in different positions to make the decisions about ACA compliance. The Chief Executive Officer makes the decisions in the majority of mid-sized businesses. However, the large business owners leave it over to Human Resources.
The Recipients of Coverage
According to the study, many organizations are going beyond the ACA full-time populations. They are also not putting a limit on employee hours in response to the requirements of ACA.
The Reasons for These Decisions
Businesses are competing to attract talent. This is perhaps the leading reason behind these decisions that the businesses are making. Many organizations have revealed that the coverage is being extended to people who are not eligible for ACA full-time. Also, a small portion of mid-sized businesses are planning on limiting hours for some of their employees.
Employees Might Take on Some of the Health Care Costs
An ADP RI study reveals that there are some employers that are leaving the health care costs to their employees. Most mid-sized and large corporations are charging their employees with the use of co-pays and deductibles. Another thing revealed by the study is the emphasis being placed by employers into consumerism. This is to help employees to improve their decisions when buying health care.
Consumer Driven Health Plans
One very huge step towards consumerism is Consumer Driven Health Plans. This engages employees in the decision making process of health care coverage. This will make sure that the employees will get the health insurance that they need.
The Low Minimum Value Plan
The low minimum value plan is something that mid-sized employees are adopting in order to better comply with the ACA. This would also make process of reporting and record keeping simple. This could also help reduce the penalties of Excise Tax which is supposed to be put in effect in the year 2018.
Effective Addressing of Requirements
Employers are facing challenges when it comes to addressing the requirements of affordability under the ACA. According to the study, quite a bit of employers are not sure of the affordability safe harbors that they will give their employees. The employers should run tests in order to find a 60% minimum value plan that is also affordable.
Are Employers Prepared
There is a clear indication in the survey that most employers are still concerned with ACA compliance requirements. The majority of mid-sized and large sized employers do not believe in their organizations ability to accurately implement all of the requirements of the ACA. The inability to use data from other systems seems to be a major reason because this is needed for ACA compliance.
Employers That Are Prepared
Even some of the employers that have access to the necessary data for ACA compliance do not feel ready to compile everything in the report. They are not confident in their ability to present all of the needed information to the IRS. They are also unable to give employees notice on time.
The Effect of ACA on Employer Assets
While there is a necessity of resources because of ACA compliance, the employer’s assets are not going to be drained. Positive benefits can be taken from a third-party provider with a comprehensive solution to ACA. No matter the choice that the employer makes, the ACA has been passed as the new law. The employers now have to abide by the new standards for ACA compliance.
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