With shifting IRS reporting regulations and worry over hefty fines for non-compliance, organizations have felt the stress of complying with the Affordable Care Act. The new regulations introduce complexity around benefits administration with a heavy reliance on data from time tracking and payroll.
What’s more, companies who have disparate systems are all too often finding that they have information that’s messy, contradictory, or just plain wrong. This makes it very difficult to understand where they are with ACA, let alone comply with it.
Under ACA regulations, companies with 100 or more full-time equivalent employees needed to offer health insurance to at least 70 percent of their full-time workers by 2015 and at least 95 percent by 2016. By June 30, 2016, employers must report to the IRS as to whether and what kind of health insurance was offered to its full-time employees. If an employer doesn’t provide coverage, provides coverage below a basic level, or provides coverage that is unaffordable, an organization faces the risk of sizable IRS penalties.
That is why we continue to educate our customers on the ACA support included as part of Workday Human Capital Management. We’ve been actively monitoring the regulations and through our continuous development approach have been building our product to make ACA management as simple and streamlined as possible for our customers.
For current Workday customers, we have a FAQ available on the ACA page of our Community site (login required). For those not on Community, here are the most common questions we hear regarding Workday’s support for ACA as we near the IRS reporting deadline.
How does Workday help customers meet ACA compliance?
There are three key features our customers can leverage to help with ACA:
- ACA dashboard. The ACA dashboard highlights full-time employees who are not enrolled in medical insurance, and part-time employees working over the 30-hour week/130-hour month ACA full-time threshold who are not currently enrolled in medical benefits. The dashboard helps provide benefit administrators with a real-time view of their employee population and organization’s status on medical benefit coverage.
- ACA measurement periods. Customers are able to define “measurement periods”—spans of time that are tracked to determine if an employee qualifies as full-time under ACA regulations based on their hours worked. At the conclusion of the measurement period, Workday can automatically trigger enrollment events if an employee becomes eligible for benefits. Workday’s measurements periods can be easily adjusted to meet the needs of the organization and changing rules associated with the regulation. Workday supports all necessary measurement periods associated with ACA: initial measurement periods, new hire measurement periods, ongoing measurement periods, and administrative periods. For more information on how measurement periods work, customers should visit the ACA Community site.
- ACA form generation and transmission. Workday will offer complimentary ACA form generation and transmission capability designed to help customers meet the ACA 2015 reporting requirements by automatically populating employee data into 1094-C and 1095-C forms and transmitting them to the IRS directly from Workday.
How has Workday validated the ACA functionality?
We have consulted with several Workday customers as well as expert legal counsel to define the specifications and design of the three ACA features.
Can I electronically submit the information to the IRS directly from Workday?
Following IRS certification, Workday will be able to transmit this information directly to the IRS.
How can I determine whether an offer of coverage was made each month?
Workday provides you with a benefit event history report to determine when an offer of coverage was made for a benefit plan. Being a single system allows customers to initiate enrollment events upon employee eligibility; there is no need to manage enrollment within a separate downstream system—or worse, multiple HR systems.
Workday has made significant investments to help support our customers with ACA. As this regulation evolves, we will continue to deliver benefits offerings to best accommodate our customers and their changing needs.
To learn more about Workday and ACA management, read the Workday ACA Datasheet.