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Easy Record Keeping for ACA Compliance



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As an employer, there are a few questions you need to ask yourself when deciding on a health plan for your employees. Health plans are required by law, and there are penalties if your company employer doesn’t provide health plans. 

Is our plan affordable to the lowest-paid employee?

Premium affordability thresholds are different for all employees. What may be affordable to an employee earning $100,000 may not be affordable to an employee earning $25,000. The safe harbor affordability guidelines suggest that the premium cost for employee-only coverage begin with not exceeding 9.66% of the monthly earnings of the lowest paid employee.

Does our plan provide the coverage required by the government? 

An Applicable Large Employer (ALE) is one who during the previous calendar year had at least 50 or more full-time and full-time equivalent employees. An ALE is required to offer minimum essential health coverage to its full-time employees that provides minimum value, covering at least 60% of the total allowed cost of benefits that are expected to be incurred under the plan.

How often does an employer have to pull this information? 

Though reporting under the Employer Shared Responsibility Provision is required annually, record keeping is a significant job for any-sized company. Employers should prepare for their annual reporting months in advance.

What’s the penalty price if an employer doesn’t provide health plans? 

There are two forms of Employer Shared Responsibility payments commonly referred to as A penalty and B penalty. The penalty price is dependent on the terms of minimum health coverage or no health coverage. If an ALE is subject to both types of penalties, the total amount of the B penalty cannot exceed the total amount of the A penalty.

Do we have the ability to track and report coverage and costs information for each employee?

This last question may be the toughest to answer, as you might have to pull data from payroll, Human Resources, time and attendance tracker, and/or benefit administration system. 

LBMC Employment Partners can assist you with both data collection and form preparation, such as: 

  • Determining applicable large employer status 
  • Monthly tracking of full-time and full-time equivalent employees
  • Monthly tracking of ACA indicator codes 
  • Track relevant employee data, medical plan coverage status, and spouse/dependent date 
  • Plan affordability threshold based on client’s safe harbor usage
  • Produce Form 1094-C and 1095-C
  • Penalty support of unmerited employer penalties 

Reporting for this 2016 calendar year will be due in early 2017. Contact us if you need help getting started!