The recent federal elections did not end the way a lot of people thought they would. Now questions are turning to what can be expected when the new Congress and president begin their terms in January 2017. If news reports are to believed, one thing we can say is that compliance with the Affordable Care Act (ACA) is now up in the air.
Assuming nothing changed in 2017, companies would still be required to provide qualifying health insurance for all eligible employees or face penalties. Employees unable to get health insurance through their employers could purchase policies through a federal exchange or the open market. As for companies, they would have to document who they provide insurance to and how it was provided.
Early indications suggest that things will not remain unchanged in 2017. In fact, rumors are already circulating that the new Congress and administration will do away with the following:
- Individual Mandate – Right now, most American workers are required to have health insurance unless they are willing to pay a penalty. If the individual mandate is done away with, it is likely that the employer mandate will also be scrapped.
- Employer Mandate – Companies are currently required under federal law to provide health insurance that meets federal standards for all qualifying employees. Those that do not have to pay penalties the same way individuals pay a penalty for not having health insurance.
- Limits on Charges – The new government could do away with the limits that now apply to how much insurance companies can charge for coverage.
- ACA Taxes – All the taxes implemented to cover the cost of the ACA could be done away with. That would mean both employer and employee taxes.
The rumor mill is further speculating that the ability to keep children on their parents' policies longer will stay in place. Congress may also keep the provision that prohibits insurance companies from refusing to cover pre-existing conditions.
What It Means to Employers
It is understandable that employers are now adopting a wait-and-see attitude about ACA compliance. This is only prudent. There really is no way to make any recommendations until there is a concrete proposal in place from the either the White House or Congress. In fact, it's probably a good idea for small businesses to assume that nothing will change in the near future. It is better to be safe than sorry.
Since ACA compliance could go in either direction, it may be advisable for some businesses that have already had trouble with compliance to consider contracting with a third-party payroll services provider. We here at BenefitMall provide payroll services to more than 200,000 companies, so hold ourselves up as just one example of a service provider more than capable of assisting the ACA compliance.
Working with us can help a business be better at what it does. By turning payroll and benefit tasks over to a payroll service provider, small businesses can concentrate on offering the products and services their customers demand. But as with anything else, business owners have to be careful with whom they contract. Going with a reputable service provider is non-negotiable given the legal implications of ACA compliance and tax reporting.
All about Following the Law
It is true that ACA compliance has proved to be somewhat of an albatross around the neck of small business. But in the end, it's all about following the law. No matter how the ACA fares under the new administration and Congress, employers cannot allow compliance to slack. They must be as diligent in 2017 as they were in 2016 – in some cases, even more so.