Common Benefit Compliance Oversights

compliance marked on rubber stamp

Continuously keeping up with the complexity surrounding benefit compliance can be quite a chore!  We have created a high level overview of some of the common benefit compliance oversights.  Complete this checklist to see if you have any areas that you need to shore up.  Be sure to make a list of any questions you may have to review with your consultant during your next Results Monitor™ or Success Optimizer™ meeting.  Feel free to contact your service specialist to schedule a call with your consultant at any time.

ACA Medical Plan Requirements

(Required for Applicable Large Employers – ALE)

  • Plan provides Minimum Essential Coverage (MEC)
  • Coverage provides minimum value (at least 60% of Actuarial Value)
  • Cost to employee is no more than 9.5% of lowest wage employee of the federal poverty level
  • Coverage is offered to employee and employee’s dependent children (if any)
  • All of the above is offered to at least 95% (70% in 2015) of its ACA full-time employees
  • Copies of signed employee waivers are on file (Best practice for ALL size groups)
  • Payroll Deduction Authorizations are on file (Best practice for ALL size groups)

Benefit Reporting Requirements

  • Tracking data for IRS Section 6055/6056 forms 1094-C and 1095-C (ALE’s)
    • Reporting requirements require substantial data; including the following: original date of hire, termination date, rehire date, payroll (Box 1 W-2, hourly rate of pay, etc.)  and hours paid (both worked and not worked).  Additionally data for employee contributions will be needed.  All data to be kept for 7 years.
  • W-2 Reporting of Benefits
  • If applicable: Eligibility data regarding the Limited Tax Credit through SHOP (25 or fewer EE’s with average pay less than 50k) – 2 year limit
  • If applicable: Data confirming financial incentives up to 30% of the cost of coverage for participation in wellness programs
  •  “Cadillac” Excise Tax will be avoided (total EE cost ≤$10,200 and total EF cost ≤ $27,500 – including HRA, FSA, HSA) – Compliance will begin in 2018

ACA Fees (Self- insured Groups)

  • Transitional Reinsurance Fee (Payments are due by 1/15/15 and 11/15/15) – Ends 2016
  • Patient-Centered Outcomes Research Institute (PCORI) Fee (Payment is due by 7/31 of calendar year that immediately follows last day of plan year to which fees apply)  – Ends 2019

ACA Document Requirements

General Notices

General Benefits and Health and Welfare Administration

  • COBRA ­­­­­­­­­­­­­­­­­­­­
  • Section 125/POP (if you are pre-taxing employee benefits)
  • Wrap Document
  •  Form 5500 filing (Completed with the first year plan has 100 participants enrolled in any one benefit).

This is a high-level benefit compliance overview.  It is not intended to replace legal counsel and/or guidance from Human Resource and financial consultants.

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