Why should employers use HRIS systems for ACA data collection?

HRIS systems centralize employee data such as hire dates, hours worked, and benefit elections, making it easier to accurately track full-time status under ACA rules. Leveraging HRIS reduces manual errors, ensures timely monitoring, and supports comprehensive ACA compliance reporting.

How can HRIS track variable-hour and part-time employees’ hours for ACA compliance?

HRIS systems can integrate with timekeeping tools and payroll to collect actual hours worked by part-time and variable-hour employees. This data helps employers determine whether employees meet ACA full-time thresholds, allowing for accurate eligibility tracking and offer of coverage decisions.

What ACA-related configurations should be set up in an HRIS system?

Key ACA configurations include defining measurement, stability, and administrative periods; setting hour thresholds for eligibility; tracking leave or waiver events; and generating alerts for when employees meet ACA full-time criteria.

How does ACA-Track enhance HRIS capabilities for ACA reporting?

ACA-Track complements HRIS by providing specialized ACA tracking, audit-ready reporting, and electronic filing of IRS forms 1094-C and 1095-C. It automates compliance monitoring, error detection, and secure data storage, streamlining the ACA reporting process.

What benefits does integration between HRIS and ACA-Track offer?

Integration ensures accurate, up-to-date employee hours and benefits data flow seamlessly between systems, reducing administrative burden and minimizing risk of ACA non-compliance. It also enables comprehensive visibility with dashboards and alerts to proactively manage ACA obligations.

How to Use HRIS Systems for ACA Data Collection: A Comprehensive Guide

Managing Affordable Care Act (ACA) compliance can be a complex and time-consuming process for many businesses. Accurate data collection, monitoring employee hours, and generating IRS-compliant reports are critical components to avoiding costly penalties. Integrating your ACA data collection with your Human Resource Information System (HRIS) can simplify the process significantly.

In this detailed blog post, we’ll walk you through how to leverage your HRIS system effectively for ACA data collection, while highlighting how ACA-Track can enhance and streamline your compliance efforts.

Why Is ACA Compliance Important for Employers?

Under the Affordable Care Act, Applicable Large Employers (ALEs)—generally those with 50 or more full-time or full-time equivalent employees—are mandated to offer affordable, minimum value health coverage to full-time employees and report compliance to the IRS. Failure to comply can result in penalties reaching thousands of dollars per employee per month.

To comply, employers must:

Track employee hours worked to determine full-time status
Monitor eligibility periods and employee events like waivers or leave
Report offers of coverage on IRS Forms 1094-C and 1095-C annually

Because ACA compliance data spans multiple departments (HR, Payroll, Benefits, Finance), it can be challenging to consolidate and track manually. This is where your HRIS system becomes invaluable.

Using Your HRIS System for ACA Data Collection: Step-by-Step

1. Centralize Employee Data and Hours Worked

Your HRIS typically stores core employee information—hire dates, terminations, employment status, job codes, and benefit elections. Ensure your HRIS is configured to collect actual hours worked for all employee types:

Full-time
Part-time
Variable-hour
Temporary or substitute employees

Tracking actual hours is crucial because under ACA regulations, full-time employees are defined as those working 30+ hours per week or 130+ hours per month on average. Without accurate hours data, you risk misclassifying employees and facing penalties.

The HRIS should allow integration or import of data from multiple time-keeping sources: manual timesheets, automated clock-in/out systems, or mobile entries.

2. Configure Measurement, Stability, and Administrative Periods

ACA compliance requires employers to measure employee hours during a measurement period (typically 3-12 months), followed by a stability period (at least 6 months) during which coverage must be offered if eligibility criteria are met.

An effective HRIS system should support customizable ACA configurations such as:

Start and end dates for measurement, stability, and administrative periods
Thresholds for hours worked (weekly/monthly) to determine full-time status
Notification alerts when employees approach eligibility

3. Automate Employee Eligibility Monitoring

The HRIS system should monitor eligibility events, such as:

Changes in hours worked
Leave of absence
Coverage waivers or opt-outs
New hires and terminations

Proactive alerts help HR and Benefits teams take timely action to offer coverage or update reporting.

4. Integrate Payroll and Benefits Data Seamlessly

Your HRIS should be integrated tightly with payroll and benefits systems, ensuring all necessary data for ACA reporting is consolidated in one place:

Payroll hours and salary information
Benefit plan enrollment and coverage status
Employee waivers or declinations

5. Generate IRS-Compliant Forms

Finally, your HRIS or a partnered ACA compliance solution should generate electronic files for IRS submission and employee distribution, including:

Form 1095-C: Provided to employees detailing offers of coverage
Form 1094-C: Transmittal summary sent to the IRS

Electronic filing is mandatory for employers with 250+ full-time employees. The system should also enable correction of errors and amendments.

How ACA-Track Elevates ACA Data Collection and Reporting

While many HRIS systems provide foundational ACA tracking features, ACA-Track offers a dedicated, proven ACA compliance solution that specializes in end-to-end ACA data management and reporting.

Key ACA-Track Benefits Include:

Comprehensive Data Collection: Captures actual hours worked across employee types and from various systems (payroll, time clocks, mobile entries).
Customizable Dashboard & Snapshots: Offers user-friendly, real-time ACA compliance monitoring with configurable data views and historical snapshots.
Advanced Monitoring & Alerts: Automatically tracks eligibility thresholds, waivers, leaves, and alerts you before employees exceed limits.
Accurate Federal & State Reporting: Simplifies generating and electronically filing IRS Forms 1094-C and 1095-C, with support for error correction.
Dedicated Client Success Advisor: Provides personalized support to make ACA compliance easier for your business or clients.
Secure Cloud-Based Platform: Ensures encrypted, HIPAA-safe data handling with SOC 2 Type 2 compliance and SAS 70/SSAE 16 certifications.

By integrating ACA-Track with your existing HRIS or payroll system, you consolidate ACA compliance tasks into one centralized platform—reducing errors and administrative burden.

Best Practices for Using HRIS and ACA-Track Together

Regularly audit and reconcile hours data within your HRIS to ensure accuracy.
Train HR and Payroll teams on ACA rules and data requirements.
Leverage ACA-Track’s alerts to address issues proactively before deadlines.
Stay updated on ACA regulatory changes and adjust system configurations accordingly.
Use ACA-Track’s reporting features to maintain documentation ready for IRS audits.

Conclusion

ACA compliance is complex, but by harnessing your HRIS system for accurate ACA data collection—augmented by specialized solutions like ACA-Track—your organization can simplify compliance management, reduce risks, and focus on your core business operations.

For employers looking for an easy-to-use, reliable ACA compliance tool that integrates seamlessly with HRIS and payroll systems, ACA-Track is a proven choice to confidently meet your ACA obligations.

If you want to learn more about how ACA-Track can fit your business needs and streamline your ACA compliance process, visit their website at ACA-Track.

Helpful Resources:

IRS Affordable Care Act Information Returns (AIR) Schema and Electronic Filing: irs.gov/e-file-providers/air
Understanding Your Letter 226-J: irs.gov/individuals/understanding-your-letter-226-j

Would you like me to help you with a step-by-step implementation plan or an overview of ACA compliance deadlines?