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Wednesday, November 12, 2014

ACA Compliance Countdown

By Tommy Eden 

For employers with 100 or more employees, Affordable Health Care Act (ACA) compliance should be in your high beams. There is a great deal of recent guidance and activity, including a notice that 5 Justices of the United States Supreme Court accepted two ACA cases to review, King v. Sebelius (DC Circuit) and Halbig v. Sebelius (4th Circuit), which were in conflict on the issue of availability of a government subsidy to those persons not residing in one of the 34 states that did not establish a state health care exchange. As the drama unfolds, many employers still have much ACA compliance work to do and this checklist may be helpful:

ACACompliance Countdown Checklist

1. Are you an Employer covered by the “Pay or Play” Mandate?
□ Are you subject to the 2015 pay or play rules based on your 2014 workforce (100 or more Full Time Equivalents [FTEs])?
□ Have you included all controlled group and affiliated service group members in your coverage determination?
□ If using a staffing company, are their workers also your common law employees (i.e. do you direct the means and manner of work performed is the 1st test)?
□ Do any special transition rules delay your compliance deadline for 6 months?
□ Have you properly classified each 2014 employee’s status with written documentation in his or her personnel file (i.e. full time, part-time, variable hour, seasonal or temporary)?
□ Have you studied the NFIB Healthcare Playbook to see how your small business is scoring on ACA compliance?

2. If you are covered?
If you must “play” and provide affordable, minimum value coverage:
□ What measurement period will you use to identify those employees who have obtained full-time status (130 hours a month average) who should be offered coverage? (6, 9 or 12 months)
□ What standard waiting period, or minimum hours of service before coverage begins will you follow? (generally must offer coverage within 90 days of full time status)
□ Do you have a form for those eligible employee who decline coverage to sign?
□ If you use a staffing company, decide who will provide health coverage, or pay the premiums, and consider including that agreement in a staffing contract addendum (Client Employer must “participate” in the offer of coverage or risk ACA penalty).

3. Is your Plan compliant?
If you must “play”:
□ Review plan(s) to confirm they satisfy minimum essential coverage rules (i.e. a “skinny plan” without hospitalization coverage will get you a fat penalty).
□ How will you calculate whether plan coverage is “affordable” (a generally if the employee only premium is less than 9.5% of the employee’s W-2 wages then the plan is affordable)
□ Have you considered adding to your Alabama BCBS coverage a wraparound secondary policy of insurance for your employees to cover all deductibles and co-pays recently offered by BCBS of South Carolina? 

4. Are you prepared for new 2014 W-2 Reporting?
□ Who in your organization will be trained to file all required reports and required information on employee 2014 Forms W-2?

5. Are your employees prepared to pay the approximate $325 tax per family member for being uninsured in 2015? 
□ On Nov. 15, 2014 open enrollment for 2015 begins at

Tommy Eden is a partner working out of the Constangy, Brooks & Smith, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter and contacted at or 334-246-2901. Blog at with live links and downloadable checklist. IRS Circular 230 Disclosure: this column is for educational purposes only and does not constitute tax or legal advice and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.