ACA Compliance: Like "American Ninja Warrior," But You'll Stay Dry
This article was updated on June 13, 2018.
Many of you may be familiar with "American Ninja Warrior," the popular TV show — I'll admit to having watched it a couple of times with my son. There's no doubt it's easier to watch people contend on the show than it is to actually compete. Affordable Care Act (ACA) compliance might not be as popular as "American Ninja Warrior," but it's certainly easier to sit on the sidelines and talk about it than it is to actually be the person in charge of an organization's compliance strategy and implementation.
Mistakes Have Consequences
Although you might not end up falling into a big pool of water like on the show, there are plenty of pitfalls and challenges as you make your way through the gauntlet of ACA compliance. In 2015, large employers were in compliance if they offered coverage to at least 70 percent of their full-time employees — the bar is now set at 95 percent.
"American Ninja Warrior" contestants train hard and put in tremendous effort, but a mistimed jump can make it all for nothing. And although the compliance gauntlet will give you a chance to try again, mistakes won't be without consequences. The penalties that apply under Sections 6721 and 6722 will apply if employers file inaccurate or late ACA reporting forms with the IRS, or provide their employees with inaccurate or late Forms 1095-C. And those penalties are small compared with the penalties that apply for things like failing to offer affordable, minimum value coverage, or reimbursing employees for individual market premiums rather than establishing a group health insurance plan. In short, failure to comply could be costly.
Year-Round Effort
Consolidating data for ACA compliance and reporting is an ongoing task throughout the year, much like training for "American Ninja Warrior." The contestants who compete in Las Vegas don't just show up on the day of the competition — they've been training consistently for months. The same is true of compliance — the wheels will fall off fast if you wait until ACA filings are due to start implementing a strategy.
Although the data gets reported to the IRS annually, tracking employees' hours, coverage offers (and whether they were accepted or declined) and coverage affordability are things best done year-round, every month. Ensuring your data is accurate and consolidated throughout the year will make the actual reporting process far easier than if you're starting from scratch in November, December or, perish the thought, the January Forms 1095-C must be furnished to employees.
You're Not Alone
Ninja warriors don't get to Las Vegas on their own. They have coaches that help them perfect their technique and train smarter rather than harder. The same is true for you. Your organization has to comply with the ACA's regulations. But that doesn't mean you have to do all the work yourself, or become an expert in its compliance overnight — or at all, thanks to outsourcing. If you want to effectively implement a complete strategy for compliance and reporting, there are a select few firms who can get you started and stick with you over the long run to keep you on track with one of the most comprehensive compliance and reporting programs.
Thankfully, Affordable Care Act compliance isn't as far out of reach as an "American Ninja Warrior" victory. It took seven seasons before someone actually made it through the entire "American Ninja Warrior" course and achieved "total victory," but you can win at ACA compliance right out of the gates. And it's not a zero-sum game, since you're only competing against the rules laid out by the ACA and the IRS — if you comply and get it done on time, you've won just as much as any other organization.
But no matter how well you do at ACA compliance, it isn't likely you'll have screaming fans cheering you on. For that, you'll have to perfect the art of climbing a 75-foot rope in 30 seconds. Then again, focusing on ACA compliance might be easier.
To find additional ACA insights, check out www.adp.com/health-care-reform.
