I think I missed a meeting, but somewhere along the way I was tasked with ensuring that the TempWorks Software customers would have a viable solution to administer the Affordable Care Act. I think solving world peace would have been a preferable assignment. As I started down this journey I talked to insurance companies, lawyers, people at the American Staffing Association, and a large number of our customers. The only thing that any of us could agree on was that ACA was complicated and none of us were completely sure that we were headed down the right path.
Some people remember where they were when JFK was shot or the Challenger went down; I remember where I was when I read that the employer mandate for ACA was delayed a year.
Some people remember where they were when JFK was shot or the Challenger went down; I remember where I was when I read that the employer mandate for ACA was delayed a year. Fast forward to February 2014 when the final (well…sort of) mandate was released and after wading through the newly- released information I felt I was finally ready to instruct a team of software developers on what our temporary staffing customers would need from us. Our mission was to boil down rules and regulations released by the IRS (not an agency known for simplicity or clarity in their instructions) into something that any recruiter or payroll clerk could understand.
Not wanting to bore you with the details of how we achieved our final solution, I will fast forward to the final result and what I learned along the way.
Our biggest accomplishment was figuring out where we could automate and where it was appropriate for a human to make a decision. We were able to automate calculations of measurement periods, stability periods and the administrative period as well as individual insurance company’s enrollment deadlines. The end result? A solution that will track each employee once they are on the “ACA radar” and warn our customers when it is time to re-evaluate an employee’s full time status.
The next biggest accomplishment was incorporating the break-in-service rules into our reporting. The 13-week break-in-service rule and the assignment-length break-in-service rule for staffing companies in particular, is one of the few concessions made that will save money on insurance premiums and the cost of administering larger volumes of insurance enrollment and subsequent COBRA.
After the basics were completed, we brainstormed on what we could add to our software that would take our solution from the “expected” to the realm of customers sending us flowers and chocolates in sheer gratitude. Visual metrics of ACA statistics (such as percentage of eligible employees who have been offered insurance), employee and employer insurance premiums by month, and counts of employees (including what phase of the ACA process they were in) were just a few of these solutions. Add in a simple solution for charging back to the staffing companies’ clients a percentage of billing (while allowing for exceptions at the customer-, order-, and employee-level) along with trending metrics of which employees are approaching full time status based on their historical hours—and we were ready to show the world what we had created. Response from our customers has been phenomenal (I’m still waiting for flowers and chocolates but I am optimistic).
So what have I learned throughout this journey? Several things. The first epiphany is that everyone is nervous as to how this ACA Employer mandate is going to play out. The uncertainty as to what the final cost to our customers will be, along with the absence of concrete reporting and audit requirements, has everyone on edge.
The second is that based on the obscurity of some of the regulations, it is impossible to completely automate everything. The variable hour employee definition, particularly for staffing companies, ensures that someone at some point will need to make a judgment call regarding an employee’s full time status.
The third thing I learned is that there is at least one person on this earth who has read the entire IRS employer mandate and that person does not live in DC, he lives in Minnesota, works as a software developer and now that his work is done, he needs to find a hobby.