Navigating the Reporting Requirements of the ACA

32 Pages·2015·1.6 MB·English

by  Erika Hardy

www.dilbert.com
Building a Smarter Workforce

The Affordable Care Act
Measurement Periods
Reporting Requirements

September 10, 2015
Agenda
Measurement Periods
Section 6055 & 6056 reporting
Why you have to report
Who has to report
What has to be reported
How to report
Employee Definitions under ACA
Employee Type Definition Penalty / Parameters
Full-Time Always average 30+ hours/week Employer must offer affordable coverage, 90 day or less
waiting period. No measurement required.
Full-Time New Hire Expected to always average 30+ hours/week Employer must offer affordable coverage, 90 day or less
waiting period. No measurement required.
Part-Time Always average < 30 hours /week If coverage is offered to employees working <30 hours
per week must have 90 day or less waiting period; but
no applicable employer penalty. Measurement required.
Variable Employee hours vary such that employer can’t determine Eligibility determined based on measurement process.
whether employee is reasonably expected to work at least
30 hours per week
Seasonal Employee Worker who performs labor or services on a seasonal Treat as variable employee for measurement and
basis, including (but not limited to) retail workers stability process
employed exclusively during holiday seasons
Measurements to Determine if a
Full Time Employee
Measurements
Safe Harbor LOOKBACK
Standard Measurement Period
Counting hours of service (3-12 months)
Administrative Period
Time for enrollment/disenrollment (Up to 90 days)
Stability Period
Coverage provided (or not) – same length for new and ongoing employees
Employees
 Ongoing Employees: employed for at least one complete
standard measurement period.

 New Employees (not employed 1 full Standard Measurement period)
 Expected Full-Time
 Reasonably expected to work 30 hours of service per week
 Must be offered minimum essential coverage by the end of the first 3
months of employment (90 days)
 Measurement of hours not required
 Variable Hour/Part Time/Seasonal*
 Employer is unable to determine at start date if the employee will average
30 hours a week or employment is expected to be of limited duration
 Measurement of hours is required
 *Seasonal – has time limits on employment dates
Example (12 month)
Standard Measurement Period
PLAN YEAR JAN 1 - DEC 31
SMP TRANSITION MP ADMIN PERIOD STABILITY PERIOD
2015 PLAN YEAR Nov. 1, 2013 — Oct. 31, May 1, 2014 — Oct. 31, Nov. 1, 2014 — Dec. 31, Jan. 1, 2015 — Dec. 31,
2014 2014 2014 2015

2016 PLAN YEAR Nov. 1, 2014—Oct. 31, N/A Nov. 1, 2015 — Dec. 31, Jan. 1, 2016 — Dec. 31,
2015 2015 2016
 REMEMBER: Ongoing Employees: employed for at least one complete
standard measurement period.
Aug – July PLAN SMP TRANSITION MP ADMIN PERIOD STABILITY PERIOD
year
2015 PLAN YEAR June 1, 2014 — May 31, July 1, 2014 — May 31, June 1, 2015 — July 31, Aug 1, 2015- July 31,
2015 2015 2015 2016
Example – Initial Measurement Period
New Variable Hour Employee – DOH is December 9, 2013
INITIAL MEASUREMENT ADMIN PERIOD STABILITY PERIOD
PERIOD
Option one: Dec 9, 2013 — Dec 8, 2014 Dec 9, 2014 – Jan 31, 2015 Feb 1, 2015-Jan 31, 2016

The IMP and the administrative period combined cannot
extend beyond the last day of the first calendar month
beginning on or after the one-year anniversary of the
employee’s start date (totaling, at most, 13 months and a
fraction of a month).

Option two: Begin measuring first of 2 months admin period Feb 1, 2015-Jan 31, 2016
month after hire Dec 1, 2014-Jan 31, 2015
Split admin period
Jan 1, 2014 – Nov 30, 2014
(11 months)
Measure for 11 months
Remember your SMP will begin to run again on Nov 1, 2014 – and this “new”
employee will be an ongoing employee then. You will be running the
measurements concurrently for the 30 days in November.
The Affordable Care Act
Overview of Title 26 (IRC) Section 4980H, Section 6055 & 6056
Section 4980H addresses the Employer Mandate of
Applicable Large Employers (ALEs) if not complying
with ACA requirements.
Part A and Part B Penalties (aka: Pay or Play rules).

Section 5000A addresses the individual mandate and
penalty for not having insurance.
********************
Section 6055 requires information be reported by ANY
ENTITY (including self insured employers and insurers)
who provides minimum essential coverage to an
individual.

6055 reporting is necessary for
Section 6056 requires ALE’s to report information on
the IRS to enforce the individual
what coverage was offered to employees, which
mandate.
employees have coverage, and the premium amount.
6056 is to enforce the employer
mandate and monitor eligibility Both 6055 and 6056 information must be reported to
for subsidies. the IRS AND the individual.