ACA Compliance Solution

ACA Compliance Solution2017-10-16T12:59:16-05:00

ACA Compliance Solution
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Understanding the Standard Measurement Period (SMP) Setup and Report2019-06-28T09:47:32-05:00

KB14-089

THE SMP SETUP: 

 It all begins with the SMP setup found in the Cloud navigation menu under Configuration>ACA Setup>Standard Measurement Period.  If you are new to the solution, you will need to use the New Schedule entry window.  We usually use Standard SMP 1 as the entry, then Save.  For those that have already setup your schedule, it is found in the Schedule ID window.  Every year you will need to update your period by clicking on ADD NEW PERIOD on the big blue line.

                                            ADD NEW PERIOD WINDOW

THE REPORT:

To run the SMP Eligibility Report you will go to Alerts and Reports>ACA Reports>Eligibility>Standard Measurement Period Analysis on the main Cloud navigation menu.  This report is designed to be run once per year at the beginning of your open enrollment period (Administrative Period).

 
The key to the SMP Report is the above setup.  The Cut Off Date should be selected from the Period ID closest to your current open enrollment beginning.  You can also change the cutoff date to measure a selected amount of time but most select the SM period that corresponds to the open enrollment. 

The Control group must also be selected from the drop down box.  If you have multiple companies then usually you would choose the Combined option although you can run the report for each company separately. 

The other options are found at the bottom of this window with check boxes to activate, as below.


Some companies want to see the hours associated with their Full Time Employees and therefore check the box Include ACA Full-Time Status.  Just remember that FT employees are already offered insurance after their Waiting Period.  The SMP report is designed to determine eligibility for your Part Time active employees.  The PT (variable hour) new hire employees go into their own Initial Measurement Period to determine their eligibility.  

If you want to only see the part time employees who are eligible for an offering, check the Show Only ACA Eligible box.  If it is unchecked the report shows all part time employees and the hours they have worked in the period. 

The other option before clicking Create is to send the report to a PDF file or to an Excel file as shown below.

Once you click Create, a pdf or excel file will be generated.  It first goes to Pending and then the link turns blue and is ready for you to click and open the file.

READING THE REPORT:

Always check to see that the Date Range is what you are anticipating. If not go back and check another SMP in the drop down box.

Columns explained:
Regular Hours – These hours are without any Unpaid Leave Hours.

Unpaid Leave Hours – This is if you track this leave using the Integrity Cloud Solution window found in Configuration>ACA Setup>Unpaid Leave.  You may be tracking all the Unpaid Leave and Hours of Service in your payroll system.  If so, the hours are included with the transactions uploaded and tally in the Regular Hours column.

Effective Hours are the total of Regular Hours and Unpaid Leave Hours.

Average Hours/Month – This is the Effective Hours divided by the number of Measurement Months that your company set on the SMP setup window in Configuration (Common is 12 months). 

Calculated ACA Eligibility – To be Eligible for a Health Insurance offer, your employees will need to have averaged 130 hours or more per month for any length of SMP.  A 12 month period would have a total of 1560 hours.  A Non-Eligible does not meet these standards for monthly average and therefore you will not need to offer these employees health insurance.

Latest Trx – This shows the last upload date for your transactions.  This is important to tell you if you have included all transactional hours for the length of the SMP.  It is wise to check the Employee Monthly Hours Breakdown Report found in Alerts & Reports>ACA Reports>Employee.  This will tell you if you are short on hours or have too many hours (both situations will give you a possible false SMP Report).

 

Questions / Resources

If you have questions or comments please email Support@integrity-data.com.

If you would like to search for information and resources for Integrity Data products check out the following sites:

Last Review:  6/26/2019– Revision: 0

Applies To:    ACA Compliance Solution

Categories:  Eligibility Reporting, Company Setup

Keywords:  Standard, SMP

Full-Time Temporary Employees – When are they eligible under the ACA?2018-11-26T16:09:52-05:00

KB14-088

Employees should be eligible for coverage after a full-time waiting period, not to exceed 90 days. There are some allowances for “seasonal” employees & workers, however, this does not apply to assignments via a staffing company. The seasonal limitation of 6 months of employment is generally accepted. There is a great SHRM article that discusses this in detail:

The ACA and Staffing: One Size Does Not Fit All
https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/aca-staffing.aspx

“… the staffing firm cannot classify a new employee who will work a full-time schedule as a variable-hour employee just because the employee is not expected to be there for the full year measurement period.”

Our guidance would be to offer coverage to all employees reasonably expected to work in excess of 30 hours/week regardless of the anticipated length of assignment after the full-time waiting period has expired.

 

Questions / Resources

If you have questions or comments please email Support@integrity-data.com.

If you would like to search for information and resources for Integrity Data products check out the following sites:

Last Review: 11/26/2018 – Revision: 0.0

Applies To: ACA Compliance Solution

Categories:  ACA Reporting Requirements; Employee Classification; Eligibility Reporting

Keywords: Temp, Staffing

Let’s Look At The Most Common 1095-C Coverage Scenarios2018-10-17T08:11:43-05:00

KB14-087

Please review the most common coverage scenarios below.

Full-Time Employee: Enrolled All Year

In this example, the employee was offered & enrolled in a minimum essential coverage with minimum value for all twelve months AND the lowest-cost, self-only plan cost increased in the month of June due to it being a mid-year plan.

  • Line 14- Code 1E is used in this example because MEC coverage providing MV was offered to the employee, spouse & dependents.
  • Line 15- Should show the employee share of the monthly cost for the lowest-cost, self-only coverage.
  • Line 16- Code 2C should be used because the employee elected coverage.
     

Full-Time Employee: Waived Coverage All Year

In this example, the employee was offered coverage at the beginning of the plan year (i.e. January) and chose to waive the offer of coverage.

  • Line 14- Code 1E is used in this example because MEC coverage providing MV was offered to the employee & their spouse/dependents.
  • Line 15- Although the employee waived coverage in this example, the employees’ monthly share of the lowest-cost self-only coverage offered still must be populated.
  • Line 16- Code 2F is used because the employee waived coverage and the employer is using the W-2 safe harbor to determine plan affordability.

 

Newly Hired Designated Full-time Employee: Waiting Period Applies

In this example, the full-time employee, reasonable expected to work more than 30 hours per week, was hired on May 5th and is eligible for coverage first of the month following date of hire (i.e. June 1st). The employee chose to enroll herself & dependents in the self-funded plan.

  • Line 14- Code 1H (No Offer of Coverage) is used for the months the employee was not employed. Code 1E is used during the months that the employee became eligible for coverage & MEC coverage providing MV was offered to the employee, spouse & dependents.
  • Line 15- The employees’ monthly share of the lowest-cost self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
  • Line 16- Code 2A is used for the months the employee was not employed. Code 2D is used for the month that the waiting period applied. Code 2C is used for the months that the employee was enrolled in coverage.

 

Full-Time Employee Enrolls in “Qualifying Offer” Plan

In this example, a full-time employee was hired on April 15th & was offered a “Qualifying Offer” plan upon completing the waiting period. So the employee was eligible to enroll on the 1st of the month following 30 days (i.e. June 1st). The 1095-C form should be coded as follows:

  • Line 14- Code 1H (No Offer of Coverage) is used during the months the employee was not employed. Code 1A (Qualifying Offer) is used during the months that the employee was eligible for the “Qualifying Offer” plan.
  • Line 15- No amount needs to be listed since Code 1A is used on Line 14.
  • Line 16- Code 2A is used for the months the employee was not employed. Code 2D is used for the months that the waiting period applied. Code 2C is used for the months that the employee was enrolled in coverage.

 

Part-Time Employee Moves to Full-Time Position

In this example, a part-time employee was promoted to full-time benefit eligible position on August 10th with coverage starting first of the month following 30 days. After completing the waiting period, the employee chose to enroll in benefits as of October 1st.

  • Line 14- Code 1H (No Offer of Coverage) is used for the months the employee was not eligible for coverage. Code 1E is used during the months that the employee was eligible for coverage. 
  • Line 15- The employees’ monthly share of the lowest-cost self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
  • Line 16- Code 2B is used for the months that the employee was part-time. Code 2D is used for the month(s) that the waiting period applied. Code 2C is used for the months that the employee was enrolled in coverage. 

 

Eligible Employee Elects Coverage Mid-Year

 In this example, a full-time eligible employee hired on February 1st was eligible for coverage starting March 1st & chose to waive coverage upon completing the waiting period in March. However, the employee got divorced on May 15th, which is considered a qualifying event, and chose to enroll herself and her children in the company’s self-funded plan effective June 1st.

  • Line 14- Code 1H (No Offer of Coverage) is used during the months the employee was not employed/not eligible for coverage. Code 1E is used during the months that the employee was eligible for coverage & MEC coverage providing MV was offered to the employee, spouse & dependents. 
  • Line 15- The employees’ monthly share of the lowest-cost self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
  • Line 16- Code 2A is used for the months that the employee was not employed. Code 2D is used for the month(s) that the employee was in a Limited Non-Assessment Period & the waiting period applied. Code 2H (Rate of Pay Safe Harbor) is used for the months that the employee waived coverage. Code 2C is used for the months that the employee was enrolled in coverage.
    * Please note that code 2C is not used in May because the employee did not get divorced until May 15th. Since the employee was not enrolled in coverage for every day of the month of May code 2C cannot be used.

 

Terminated Employee

In this example, a full-time employee was enrolled since the beginning of the plan year (i.e. January 1st), and then ended their employment with the company on August 15th. Coverage terminates on the day of termination.

  •  Line 14- Code 1E is used for the months that the employee, spouse & dependents were eligible for MEC coverage providing MV.  Code 1H is used for the months in which the employee was no longer employed, thus there was no offer of coverage.
  • Line 15- The employees’ monthly share of the lowest-cost, self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
  • Line 16- Code 2C is used for the months that the employee was enrolled in coverage. Code 2A is used for the months the employee was not employed.
    ** Please note that the employee will not have a coverage code on lines 14 or 16 in this example, because coverage terminated mid-month. Therefore, the employee was not covered for every day of the calendar month.

 

Employee Elects COBRA upon Termination **Self-Insured Plans Only**

In this example, the full-time employee terminated their employment in July and COBRA was offered to the employee, spouse & dependents. The employee enrolled in COBRA starting in August and remained on COBRA for the remainder of the calendar year. The form example below would also apply to an employee who continued coverage as a retiree.

  •  Lines 14/15/16- The codes will be identical to that of a regular terminated employee (see example above).
  • Part III- This section should indicate which months the employee and/or dependents were enrolled in the employer’s health plan and COBRA. The “Covered All 12 Months” box is checked because the employee was enrolled in the employer’s medical plan from January –July, then immediately elected COBRA in August and remained on COBRA through the end of the year. Therefore, the employee was enrolled in coverage all twelve months. Please see example below:

* COBRA only needs to be reported by employers with self-funded health plans.

Employee Terminated in Prior Year – Enrolled in COBRA All Year **Self-Insured Plans Only**

In this example, an employee terminated their employment in 2017 & elected COBRA. This employee has remained enrolled in COBRA for all twelve months of 2018. The form example below would also apply to an employee who continued coverage as a retiree:

  • Line 14 – Code 1G (Offer to Non-Employee). * Code 1G applies for the entire year or not at all
  • Line 15- Should be blank
  • Line 16- Should be blank
  • Part III- Should be completed for each enrollee. Keep in mind that this section must be completed for non-employees as well 

 

Employee Enrolled in Union-Sponsored Plan

In this example, the employee was enrolled in a medical plan that is 100% administered by the union:

  • Line 14 – Code 1H (No Offer of Coverage). This code is used because the Union actually offering the plan, not the employer.
  • Line 15- Should be blank.
  • Line 16- Code 2E (Multiemployer Interim Rule Relief
     

Variable Hour Employee Completes IMP and Becomes Eligible for Coverage

In this example, a newly hired variable hour employee averaged over 30 hours per week during their Initial Measurement Period. There was no waiting period, the employee was eligible first of the month following the completion of the IMP.

  • Line 14 – Code 1H (No Offer of Coverage) is used during the months the employee was in an IMP. Code 1E is used starting the month the employee is enrolled in coverage.
  • Line 15- The employees’ monthly share of the lowest-cost, self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
  • Line 16- Code 2D is used during the months employee was in the IMP, Code 2C is used starting the month the employee is enrolled in coverage

 

**For More Information: KB14-086 “1095-C Form Review-Line 14, 15, 16 & Part III”

 

Questions / Resources

If you have questions or comments please email Support@integrity-data.com.

If you would like to search for information and resources for Integrity Data products check out the following sites:

Last Review: 10/17/2017 – Revision: 1.0

Applies To: ACA Compliance Solution

Categories:  Year End – 1095-C and Filing, Import of Data

Keywords: 1095-C, Codes

1095-C Form Review – Line 14, 15, 16 & Part III2018-10-17T07:53:55-05:00

KB14-086

The purpose of this document is to assist in reviewing the accuracy of your 1095 forms.

Line 14 – Offer of Coverage

Line 14 on the 1095-C form provides details of the coverage that was offered throughout the year, including:

• Whether or not health insurance coverage was offered
• The type of coverage that was offered
• The months in which coverage was offered

The code on line 14 may vary as to the quality of the coverage offering. A line 14 response is reported for each month of the year. Also, line 14 codes do not indicate what coverage the employee enrolled in, instead the codes indicate what coverage was offered to the employee. You can use a code that indicates coverage if the employee was offered coverage for every day of the month. If the offer of coverage was not good for every day of the month, 1H will be applicable.

*Line 14 does NOT indicate whether coverage was accepted. That information is reported in Line 16.
 
**In the above example, the employee had the same coverage available for the entire year, so the response is listed only once, at the top of the column. If the available coverage changed during the year, a separate response would be entered for each month.

* Please review this KB article for detailed descriptions of each line 14 code

Line 15 – Employee Required Contribution

Line 15 provides the amount of the employee required monthly contribution. The amount listed on line 15 may not be reflective of the medical plan cost that the employee actually enrolled in. This amount should represent the cost for the lowest-cost, self-only coverage offered to that employee.
 
Line 15 should only be populated if line 14 has a code of 1B, 1C, 1D, 1E, 1J or 1K on line 14. If one these codes is listed in the “All 12 Months” column on line 14, there should also be a line 15 entry for all 12 months as well. If line 14 does not have one of these codes for any given month(s), line 15 should be left blank for that month.

*Please review this KB article for additional details on line 15

Line 16 – Eligibility

Line 16 provides information about the employees’ eligibility for health coverage and the coverage status for each month of the calendar year. Similar to line 14, a coverage code can only be used if the employee was actually enrolled for every day of the month. Otherwise, a different code will need to be used.