ACA-Track vs. Manual Tracking: Time to Make the Switch

Navigating the complexities of the Affordable Care Act (ACA) compliance can be overwhelming for many employers. The responsibility of tracking hours worked, monitoring eligibility, and ensuring proper reporting can strain already busy HR and payroll departments. Whether you’re managing a small business or a large organization, ACA compliance is non-negotiable. Fortunately, solutions like ACA-Track can simplify the process. In this blog post, we’ll explore the differences between ACA-Track and manual tracking, helping you understand why it’s time to make the switch.

What is ACA Compliance?

Under the ACA, certain employers are required to offer health insurance coverage to full-time employees (and their dependents). The law includes detailed reporting requirements that ensure compliance with these provisions, particularly for Applicable Large Employers (ALEs). These employers must provide specific data to the IRS using forms 1094-C and 1095-C.

The key to ACA compliance is accurately tracking employees’ hours, monitoring their eligibility for coverage, and ensuring timely and accurate reporting. This task is made even more complex when dealing with variable-hour employees, part-time workers, and other workforce classifications.

Manual Tracking: The Traditional Approach

Manual tracking of ACA data often relies on a combination of spreadsheets, paper forms, and hours of tedious data entry. For small businesses, this might seem like a manageable solution, but as companies grow and their employee base diversifies, the system quickly becomes unsustainable. Here are some common pitfalls of manual tracking:

• Time-Consuming: Manual tracking requires constant attention to detail. HR and payroll teams need to cross-check hours worked, eligibility, and benefit offerings manually. This is time-consuming and prone to error.

• Error-Prone: With so many variables to monitor (such as full-time vs. part-time status, eligibility thresholds, and multiple employee systems), errors are inevitable. Miscalculations can lead to costly penalties.

• Difficulty in Reporting: Compiling the required 1095 and 1094 forms from multiple sources is cumbersome. For companies with a large or dynamic workforce, manually generating these reports can be a daunting task.

• Lack of Audit Trail: In the event of an IRS audit, finding the necessary documentation quickly can be difficult with a manual system. The inability to access an organized and comprehensive record of data increases the risk of non-compliance.

• Limited Integration: Manual systems often lack integration with payroll, HRIS, and financial management systems. This creates silos of data that must be manually reconciled, resulting in more room for error and inefficiency.

ACA-Track: The Efficient Solution

Now, let’s look at how ACA-Track simplifies the ACA compliance process. Designed to collect, monitor, and report all ACA data in one seamless platform, ACA-Track is an essential tool for employers seeking to minimize risk and maximize efficiency.

Key Features of ACA-Track

• Automated Data Collection: ACA-Track automatically collects employee hours from multiple systems, including timekeeping, payroll, and HRIS platforms. It consolidates data from all sources (including variable-hour and part-time employees) to ensure accurate tracking of full-time equivalent (FTE) status.

• Real-Time Monitoring: ACA-Track monitors employee eligibility in real time. It provides advance alerts when employees exceed eligibility thresholds, such as the 30-hour/week threshold for ACA coverage. It also tracks events like waivers and leave.

• Comprehensive Reporting: ACA-Track generates accurate 1094 and 1095 reports, eliminating the need for manual form creation. These reports are prepared electronically, ensuring that all data is properly formatted and ready for IRS submission. ACA-Track also allows for easy retrieval of data in the event of an audit.

• Snapshot Views: The unique snapshot summary feature in ACA-Track preserves ACA data at a given point in time, ensuring that you can always access historical data for compliance verification or audit purposes.

• Customizable Dashboard: With ACA-Track, you have full control over the user interface. You can tailor the dashboard to display the data that matters most to you, filter by employee status, and sort by various metrics to streamline data review.

• Secure Cloud-Based System: ACA-Track utilizes a SAS 70-certified cloud-based system, ensuring your data is secure and compliant with industry standards like SSAE 16 and SOC 2 Type 2.

• Easy Integration: ACA-Track integrates seamlessly with existing payroll, HRIS, and financial systems, eliminating the need for manual data transfers or double entry.

• Client Success Support: ACA-Track provides access to a dedicated Client Success Advisor, ensuring that you have the support you need to navigate ACA compliance with ease.

Why Switch to ACA-Track?

While manual tracking may seem like a cost-effective solution initially, the risks associated with it far outweigh the benefits. Here’s why ACA-Track is the smarter choice for employers:

• Accuracy and Compliance: ACA-Track reduces the chances of errors by automating key processes, ensuring that your reporting is accurate and compliant with IRS regulations. With real-time data monitoring, you can rest assured that you’re meeting ACA requirements without worrying about missed deadlines or costly penalties.

• Time and Resource Savings: By automating data collection, monitoring, and reporting, ACA-Track saves your team significant time. With ACA-Track handling the heavy lifting, your HR, payroll, and finance teams can focus on more strategic tasks.

• Scalability: Whether you have a small workforce or employ hundreds, ACA-Track scales to meet your needs. It’s the perfect solution for growing businesses that need to streamline their ACA compliance processes.

• Peace of Mind: The platform’s user-friendly design and robust reporting features mean you can quickly access the data you need, whenever you need it. Plus, with a dedicated support team ready to assist you, ACA-Track provides peace of mind knowing that your compliance is in capable hands.

• Audit-Ready: ACA-Track keeps all your ACA data in one place, making it easy to retrieve during an IRS audit or in response to a state healthcare exchange request. The snapshot feature ensures you always have historical data at your fingertips, ready for inspection.

Avoiding the Pitfalls of Non-Compliance

The consequences of non-compliance with ACA regulations can be severe. Employers who fail to meet ACA requirements risk facing substantial penalties and fines. In 2020, the IRS assessed penalties for late ACA filing at rates of $50 per return (if filed within 30 days), up to a maximum of $194,500. Fines increase if forms are filed more than 30 days late, with penalties as high as $270 per return ($1,113,000 maximum) for forms filed after August 1.

With ACA-Track, employers can mitigate these risks by ensuring accurate and timely ACA reporting. The platform streamlines compliance, helping you avoid costly mistakes and ensuring that your organization stays on the right side of the IRS.

Conclusion: Make the Switch to ACA-Track

While manual tracking may seem like a feasible option for some organizations, it quickly becomes clear that the complexity and risks of ACA compliance require a more efficient solution. ACA-Track provides a comprehensive, automated, and user-friendly platform that simplifies the tracking, monitoring, and reporting processes required to stay compliant with ACA regulations.

Don’t wait until the penalties start piling up—make the switch to ACA-Track today and ensure your organization is always prepared for ACA compliance.