Small Group ACA Challenges
Top 5 Healthcare Compliance Concerns of Small Employers
Small employers don't have to deal with the extensive ACA reporting that larger employers do. More importantly, they are not bound by the Employer Shared Responsibility Penalty because they are not required to offer health insurance at all if they don't want to. We also have our small group health reform toolkit available, click here for your copy.
For our small employers in Tennessee, defined as fewer than 50 Full Time Equivalent (FTE) employees, the top compliance concerns are:
All employers covered by FLSA are required to provide employees a notice about the availability of the Affordable Care Act's Health Insurance Exchanges (Marketplaces). There are template notices available and employers should verify they are meeting the Exchange ("Marketplace) notice requirements, as well as other health plan notice requirements.
Benefits Plan Structure
Any employer offering health benefits must ensure their health plan meets minimum essential benefits as required by the ACA. For example, the new plans require all health plans to cover preventive care without cost-sharing and not place an annual or lifetime limit on essential health benefits. Policies are also bound by community rating, guarantee issue and not excluding pre-existing conditions.
These new ACA compliant plans have four levels of benefits. Bronze are the least expensive with the highest deductibles and out of pockets. There are also Silver, Gold and Platinum with higher cost, and lower deductibles.
Eligibility and Enrollment Requirements
Any employer offering health benefits must follow new eligibility and enrollment requirements. For example, the ACA requires a maximum waiting day of 90 days. This has changed the waiting period for most groups to the first of the month following 60 days. Additionally, a full-time employee is anyone working more than 30 hours per week. There are also new health plan notices required at enrollment and throughout the year.
Minimum Essential Benefits
A new concern for business owners is the requirement for all individuals to have minimum essential coverage or be subject to the new shared responsibility payment. In other words, they must have qualified health insurance coverage regardless if it is available through work. Medical policies are also required to provide a minimum level of coverage including guarantee issue, community rating and no pre-existing conditions. Most employers are choosing to add group coverage because of the lower cost and the ability for employees to pay premiums with tax-deductible dollars.
Another ACA compliance concern for small and growing businesses is to not become an Applicable Large Employer (ALE), where the Employer Shared Responsibility provision would come into play. Under the new ACA requirements, a full-time employee is anyone working at least 30 hours per week.
In Tennessee, the difference between a large and small employer is 50 Full-Time Equivalent Employees (FTE). This can be a complicated calculation if you have part-time or seasonal employees as their hours count toward your FTE calculation.
The Patient Protection and Affordable Care Act (PPACA) is complex”and it has a profound impact on your business. Together we can develop a plan that will prepare you for federal agency audits and help steer clear of fines and taxes.
Call today for more information 615-724-1701 or email