ACA Reporting and Disclosure—Someone’s Gotta Do It

Laundry, shoveling snow, a big pile of dishes, replacing the busted water heater, filing taxes. These are things that must be done, that you’ve dreaded doing and that perhaps you’ve learned the hard way it’s best if someone else does them for you.

Now a similarly necessary yet dreaded list is encroaching your work in benefits. Beginning in 2016, organizations are subject to increased reporting requirements under the Affordable Care Act (ACA). Employers and health insurers are required to prove compliance with ACA employer and individual mandates, while providing each full-time worker with proof of health coverage. These requirements are becoming a significant burden on employers.

According to results from the most recent Foundation ACA survey, 2016 Employer-Sponsored Health Care: ACA’s Impact, more than half of responding organizations view reporting and disclosure issues as their biggest ACA challenge. Digging further, respondents articulated their specific challenges.

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aca survey reportingThe top challenges that employers are facing include meeting the mandated deadlines, collecting additional information forms (not including Social Security numbers), understanding the forms, and identifying who should be reported on the various forms.

Much like the list of household chores, there are some things you must do yourself and others it’s best to hire out. Organizations are utilizing a combination of internal staff and plan professionals to navigate the myriad reporting and disclosure requirements.

[Related: The Effects of ACA on Medical Expense Accounts (HSAs, FSAs and HRAs)—Free Member Webcast, June 23, 2016]

Who is handling reporting for both self-funded and fully insured plans?

  • Self-Funded Plans (1095-B or 1095-C)—Reporting is most commonly done by internal staff (30.8%), vendors hired for this purpose (28.4%), payroll vendors (16.7%) and third-party administrators (16.1%).
  • Fully Insured Plans (1095-C)—Organizations most commonly utilize vendors hired for this purpose (24.7%), payroll vendors (23.8%), internal staff (21.1%) and their insurance company (17.6%). In these cases, the insurance company provides minimum essential coverage in addition to providing Form 1095-B.

Who is filing the applicable forms with the Internal Revenue Service?

  • 1094-B—The most common filers of the 1094-B are the respondent’s insurance company (19.6%), internal staff (12.4%), vendors hired for this purpose (12.2%) and third-party administrators (11.1%).
  • 1095-B—Similarly, 1095-B filers most typically include the organizational insurance company (23.7%), internal staff (13.4%), vendors hired for this purpose (12.0%) and third-party administrators (10.8%).
  • 1094-C—The 1094-C is most commonly filed by internal staff (23.0%), vendors hired for this purpose (22.1%), payroll vendors (20.5%) and third-party administrators (13.4%).
  • 1095-C—These forms are also most commonly filed by internal staff members (26.3%), vendors hired for this purpose (23.3%), payroll vendors (21.9%) and third-party administrators (14.5%).

While there are definite benefits of having a professional do the work, there is of course a price to pay. Seven in ten (69.3%) respondents stated that the financial impact of reporting and disclosure requirements is either very or somewhat significant. There is hope that increased guidance will make these processes more seamless and less costly in the future.

 Now, on to those dishes.


Justin Held, CEBS
Educational Program Specialist/Research Analyst at the International Foundation