Companies Struggle With ACA Reporting
New reporting requirements mandated by the Affordable Care Act are posing 
challenges to large and small companies, and most employers have made little progress on deciding on or implementing a solution.
That’s the conclusion of a survey of 480 employees in 36 industries across the United States. Only 10% of the employers said they have a solution in place to collect the data needed to file the required forms with the IRS early next year, and 16% said they have not begun to figure out what they should do.
Many of the largest companies surveyed said they were planning to use a dedicated ACA compliance vendor. This is the course for 35% of those with over 5,000 employees plan to follow. For those with 1,000 to 5,000 workers, 24% are planning to use a compliance provider. Only 13% of companies with fewer than 1,000 workers say they will do so, planning instead to get help from their payroll services vendors.
The preference among large employers to utilize specialized ACA compliance firms may reflect their need to ensure that they also meet the criteria of other regulatory bodies, such as the Financial Accounting Standards Board (FASB) in the case of public companies or the Federal Deposit Insurance Corporation (FDIC) for banks.
The survey was conducted in the first quarter of 2015 by PwC, a global accounting firm, and Equifax Workforce Solutions, a unit of Equifax Inc., which provides the consumer, commercial and workforce information solutions.
About two-thirds of all the companies surveyed acknowledged being concerned about data quality because the information they will have to provide to the IRS is scattered among their HR, payroll, benefits administration and leave-of-absence systems, and some data may be held by third parties.
The degree of preparedness for filing the required IRS Forms 1094 and 1095 varies by the size of the company, the survey indicated. About 26% of small firms (those with less than 1,000 employees) have not decided whether they will implement an in-house solution or outsource the task to a vendor, while the figure drops to 15% for those with 1,000 to 5,000 employees, and 12% for even larger companies.
In addition to having to file reports with the IRS, employers are likely to have to respond to notices sent by state or federal exchanges when employees apply for subsidized insurance. Some 43% of those surveyed said they are concerned about their ability to respond timely to these notices. Among large companies operating in multiple states, 61% said they are concerned about being able to respond.
|
