Employer mandate penalties are coming

It’s been two years of required reporting of the Employer Mandate under the Affordable Care Act (ACA) but the IRS has yet to impose any penalties on employers for failing to comply with the law. This delay has suggested to some employers that the IRS would not be enforcing the mandates or collecting penalties. The Treasury Inspector General for Tax Administration (TIGTA) just released a report that is a game changer.

On April 7, 2017 TIGTA issued its, “Assessment of the Efforts to Implement the Employer Mandate under the Affordable Care Act.” In this report, TIGT explained that the IRS has developed an ACA Compliance Validation (ACV) System. It will be used to identify potentially non-compliant Applicable Large Employers and calculate the “A” penalty under the Employer Mandate. The IRS has been developing the ACV system since July 2015 with a scheduled completion date of January 2017. However, “the implementation of the ACV System has been delayed to May 2017.”

The report states that once the systems are in place, the IRS will be able to mass identify noncompliant employers. This will allow the IRS to send notices to noncompliant employers for any and all reporting years.

This means that time is up for employers who were delaying. The current lack of IRS notices for noncompliance with the Employer Mandate does not imply that the IRS does not intend to enforce the Employer Mandate. The IRS will come knocking, they are just running behind schedule. FreedomCare has the solutions you need, answer our simple questionnaire to get started.

You can’t take the summer off from the ACA

4 reasons you cant take the summer offIt’s July and we are halfway through the summer; I know a lot of my clients and brokers are taking their yearly family vacations.

While you should enjoy time with your family, the end of the year will be here before you realize and unfortunately we can’t afford to take the summer off from the Affordable Care Act (ACA).

Here are 4 reasons why.

1.  IRS penalties are accruing monthly.

We commonly refer to the IRS penalty amounts as an annual amount but the penalties are actually calculated on a monthly basis. Acting sooner rather than later and getting a compliant plan in place can save employers valuable dollars on penalties that won’t have the opportunity to accrue.

2.  Exchange notices are arriving.

For every employee that logs onto the Insurance Exchange and receives a health care subsidy, a complex trail of communication and paperwork begins that requires employers to prove the status of their health care offering. If an employer has chosen to offer coverage that isn’t compliant or no coverage at all, they will have no choice but to pay the penalties.

3.  Employee eligibility is constantly changing.

Employee status can change on a daily basis, so employers can’t afford to take a break from data collection and management. Employers have to be ready for whatever comes their way – even an IRS audit. ACA requirements have become tougher in 2016, employers must now offer affordable coverage to at least 95% of their full-time employees – up from 70% in 2015. As these and other changes take place, employers have to continue to calculate benefits eligibility and affordability for required employees.

4.  Annual reporting is just around the corner.

Reporting is an annual event. But employers can’t take a break for the rest of the year, the ACA record keeping they do all year is essential for the next reporting season. This includes the information employers must provide to the IRS and their employees that demonstrates the health care coverage offered to employees meets minimum essential and affordability requirements of the ACA.

Bottom line? The ACA is complex and this year the rules are firmer than ever. Most organizations don’t have the expertise and processes to stay on top of these changes and take accurate action.

The good news is, we can help with all of these issues and more. But employers need to take the first step and not delay. Choose to benefit from our comprehensive expertise so you can look forward to smooth ACA compliance and a great rest of the year.

Employers on the hook for $228 billion in ACA penalties

Employers on the hook for $228 billion2016 brought enforcement of required reporting for the Affordable Care Act (ACA) and thousands of US employers are not in compliance with the laws. This is going to translate into billions of dollars in tax penalties. Some employers chose to do nothing when it came to the law; others may think they are compliant. The opportunity for error was extensive. Brokers and employers trusted insurance companies to help them navigate the laws and choose a plan that met the requirements of the ACA.

The annual baseline budget projections by the Congressional Budget Office and Joint Committee on Taxation (CBO), is projecting employer responsibility penalties to total $228 billion over a 10-year period from 2017 to 2026. The individual mandate penalty will yield a projected $28 billion, along with high-premium employer plans (aka the Cadillac Tax) is expected to yield $18 billion.

You may have clients who have done nothing to avoid these penalties or even clients who think they’ve done all they need to do. We have tools and resources available to help you determine whether or not your clients are protected.

Congress has a 10-year projection of collecting these penalties from employers, the only solution is guaranteed compliance with a plan from FreedomCare.

The ACA is hear to stay.

ACA is here to stayAccording to NBC news, 9 in 10 in Americans have health insurance. “More than 7 million people who didn’t have health insurance last year got coverage this year.”

With the ACA being such a hot topic among presidential candidates, it will be an uphill battle to repeal. It seems like the ACA is here to stay.

American attitudes about the law have become more positive in recent months and the Supreme Court is on board. The time has come and passed for employers to ensure their compliance.

Just in case you have been living under a rock, employers are facing major penalties that have the potential to bankrupt their companies if they don’t get a compliant plan in place.

Be careful, there are a lot of non-compliant plans out there that will leave you vulnerable. Check out the FreedomCare difference to learn how FreedomCare stands apart from everyone else to make sure your business is protected.

ACA Benefit Small Business Owners

How does the ACA benefit small business owners?

What if I told you there are opportunities for small business owners to attract better talent and have healthier employees? Here are 3 ways the ACA can benefit small business owners.

1. Better recruiting and higher retention.

You now have the opportunity to reinvent your employee benefits for your small business. Gone are the days when only the larger employers could offer the benefits it takes to recruit the best employees. With the ACA, you are now able to offer employees access to discounted health insurance benefits such as individual health insurance which provides qualifying individuals access to premium tax credits.

2. Think outside of the box – Self-Insurance.

Your Group is never too small to self-insure. Before the ACA small business owners had limited options for providing health insurance to employees and the idea of self-insurance was just for the big boys like Walmart, Target, etc. but now it’s available to all business owners. We want to help you offer affordable competitive benefits through self-insuring.

3. Increased productivity.

We have programs in place to improve your employees productivity, employees who have enhanced access to health insurance services and options tend to be healthier and cost your business less. Healthy employees are able to come to work more and produce at a higher level of productivity versus an employee who does not have access to health insurance services and is constantly sick. Some of the unforeseen costs of having sicker absentee employees are their replacement costs. The expense of finding a new worker, training them, allowing for their learning curve, et cetera.

These are just some of the ways the Employer Mandate benefits small business owners. Stay educated, we are a resource for your questions and here to help you. Contact FreedomCare today.

*For purposes of the employer mandate – FTE classifies all employees who work 30 hours or more.