Despite the fact that employers could be subject to dramatic financial penalties for failure to comply with the Shared Responsibility mandate of the Affordable Care Act (ACA), new ADP research suggests most are unprepared.
In this new ACA Compliance Report, the ADP Research Institute® examines how large and midsized businesses are navigating the complex ACA compliance landscape. The results are striking: more than half of midsized (50-999 employees) and large (1,000+ employees) employers are not fully prepared to comply with ACA requirements, including Exchange/Marketplace notices. Even more worrisome, roughly half of midsized (54%) and large (49%) businesses aren’t prepared to manage IRS annual health care reporting.
Despite these findings, our research suggests employers are taking strategic steps in response to ACA challenges . More specifically, the study found that:
- More employers are shifting costs to employees, with 70% of midsized and 80% of large businesses changing or increasing employee co-pays.
- Over half of large employers (57%) plan to offer a Consumer Driven Health Plan (CDHP) to help reduce costs.
- Nearly half (49%) of midsized businesses and 62% of large businesses have extended benefits coverage to employees beyond the ACA Shared Responsibility mandate (30+ hours) to avoid penalties and attract or retain talent.
Among the most daunting aspects of ACA compliance are the reporting requirements that necessitate compiling comprehensive employee data from various workforce management systems, including HR, benefits, payroll, time and leaves of absence. This process is time-consuming and complex, so a third-party partnership is a good option for many organizations looking to alleviate the pressures of ACA on their staff. Solutions such as ADP Health Compliance make it even easier to integrate data from throughout the company.
With potentially hefty penalties going into effect just one year from now, the decision to go it alone could prove risky based on current levels of preparedness. To learn more about steps to take to ensure your business is fully prepared to comply with ACA requirements. Get the full report.
This article originally appeared on the ADP@Work Blog.