Your Friendly Guide and Checklist of ACA Compliance for Small Businesses

Let’s be honest—understanding the ins and outs of the Affordable Care Act (ACA) is like trying to put together a complex 100-piece shelf without instructions. Too many screws, not enough clarity. But fear not! With a few guiding tips and some relatable stories, you’ll be an ACA whiz in no time.

Why ACA Compliance Matters

Obamacare, or the Affordable Care Act (ACA), strives to increase access to health insurance, which brings added responsibilities, especially for small business owners who have several employees. Remember the first time you thought about being an employer? Your hands started sweating because of the American legal monstrosity that looms overhead? You panicked thinking about owing huge fines while desperately searching Google for BA law degrees or practicing TA to become improper Title VC lawyers. Spoiler Alert: Chill out! All you need is patience alongside checklists so flat it’d make IKEA proud.

Are You an “Applicable Large Employer”?

Let’s tackle the most important part: ACA compliance. The issue for most employers comes at a size threshold of 50 employees. An employer will be considered an “Applicable Large Employer” (ALE) if they have 50 or more full-time equivalent employees (FTEs) in the preceding year. In that case, health coverage must be offered at least to all full-time staff members.
Initially, I thought I was not over the mark. But as my team grew, I checked from time to time. It is indeed useful to estimate your employee count if you are close to this number. Alternatively, you can set reminders on your go-to productivity apps like Controlio.

Key ACA Compliance Checklist

To make sure everyone stays on track and no one misses out on these vital steps:

1. Determine Your Status
   • Track your workforce: the total count of employees includes both part-timers and full-timers; do translate the part-time hours into FTE for hire as well.
   • Log hours: Pay attention to every employee’s hours worked. This is manageable with reliable time-tracking systems available in the market today.
2. Offer Affordable Coverage
   • Affordability test: Ensure that any monthly contribution towards health plan premiums can pass basic economic tests vis-à-vis employee compensation structures.
   • Minimum Claim Value: Your plan must pay at least 60% of the allowed maximum cost of benefits.
3. Disseminate Relevant Information and Documents
   • Marketplace notification: Inform new employees about the marketplace for offering health plans.
   • Summary of Benefits and Coverage (SBC): This document should be given at enrollment and renewal.
   • Form 1095-C: An applicable large employer (ALE) must issue this form to full-time employees by January 31 annually.
4. Steering Clear of the Most Common Mistakes
   • Classifying employees incorrectly is a problem: Deregistering an individual as an employee simply to switch them to a 1099 for ACA compliance is dangerous.
   • No direct reimbursements: Unless using a designated QSEHRA, don’t counterbalance claims before plans.

Self-Revelation: Persistent Document Systems Under Compliance

The first time was the most difficult. For me, responding to paperwork concerning reporting requirements associated with the Affordable Care Act was less challenging than you’d assume—not until an SBC oversight slapped. Adjusting PCs to my calendar and adding direct reminders for enrolled and rescheduled claim-contingent deadlines going forward, matters improved substantially. My workflow routines, shifting in place, truly simplified tasks like attendance with snowball systems.

Automating Compliance Activities

Meeting all these responsibilities can be difficult to keep track of, but there are several tools available that can help you. Solutions such as Controlio software can assist you in managing workloads for the employees on your team, meeting deadlines, and organizing tasks. For those intrigued about best practices in compliance and managing work hours, there are helpful tips explained here.

Keep On Going: Words of Encouragement

While ACA compliance may feel like it has a lot of moving parts to manage, the truth is it can be dealt with effectively if the work is prioritized correctly. Stay organized, and try to stay focused on one task at any given time to avoid fatigue—but above all else, don’t hesitate when it comes to asking for support. Countless small business owners have faced this challenge and emerged unscathed.
Feeling overwhelmed? That’s okay! Just breathe deeply and mentally break complex arrangements into more manageable bits. The odds are that very soon amazing things will happen—like being able to advise fellow owners on ACA compliance procedures along with checklists!