Everyone is shifting into planning mode this month, thinking about open enrollment for 2016 benefits. Whether you are making major benefit plan changes, going out to bid for services, or keeping things status quo, here’s what you need to keep in mind relative to the ACA.
Reporting requirements. If you have not yet established processes for ACA reporting for 2015, you are not alone. Many employers are just now focusing on the requirements and looking for resources to support compliance. There are many third-party options available to help if your payroll or HRIS teams don't have the bandwidth. But it’s best to get started now.
Tracking hours. Stay on top of eligibility determinations for variable-hour employees in a measurement period. Now that we are in full ESR compliance mode, be sure that your tracking systems are working well and a process is in place to identify individuals who should be offered benefits at the end of your initial and standard measurement periods. This will be an extra step in planning for open enrollment.
Temporary Reinsurance Fee. Just as a reminder, the annual fee is $44 per covered life for 2015 ($33 payable in January 2016, $11 in December 2016). As you project costs for 2016, remember that the fee will reduce to $27 per covered life, payable in a lump sum or two installments of $21.60 and $5.40.
Excise tax. We were pleasantly surprised to get documentation from Treasury for review and comment (IRS Notice 2015-16). It is the first of two documents they intend to release, with the second coming in a few months. The real takeaway, as it relates to 2016 planning, is that 2018 is not that far away! It is a good idea to look at a projection for 2018, based on what we know today, to determine your risk for hitting the threshold (here’s a calculator you can use that takes your medical plan costs as a starting point). Many employers have been making changes in anticipation of the tax for several years.
Exchange subsidy notices. Now that open enrollment for the public exchange is wrapping up, you may receive a notice if one of your employees signed up for subsidized exchange coverage. If you have multiple locations, you should alert staff at each site that a notice could be sent to their location and let them know where to forward it. It is also a good idea to establish a process for reviewing the notice and deciding how to respond under the various possible scenarios, including communication with the employee and/or the exchange.
Summary of Benefit Coverage (SBC). Be sure to check for updated template language and include the SBC on your open enrollment communication check-list.
Yes, I know it feels like 2015 open enrollment just ended. But with ACA compliance, as with your health, an ounce of prevention is worth a pound of cure.