Good morning, everybody. Thank you for joining today’s webinar, Beyond the Basics Evaluating Your ECA Compliance Strategy. We thank you for your time, spending some time with us today. I’m Robin Carlini. I’ll be your webinar moderator today. And a little disclaimer, everyone at Solarix, we’re ACA knowledge experts, but you will still need to ask your legal counsel for specific legalese questions. Before we get started, little bit of housekeeping. Today’s webinar is being recorded. All registrants will receive the recording tomorrow. And in your Q and A box in the Zoom webinar, can go ahead and type your questions in, and we can answer throughout the webinar and towards the end as well. Upon exiting, you’ll see a survey. Please answer those questions that helps us with these webinar topics that we do monthly. Also, we’ll be asking some poll questions throughout the webinar. And now I get to introduce our speaker today, Kelly Smith. She’s the director of ACA compliance here at Solaris. Kelly, can you tell everyone a little bit about yourself? Absolutely. So thank you, Robin. I’ve been with Solirix for, oh, next month, it’s gonna be twelve years, hard to believe. And I have been working on the ACA side of things since inception. So I definitely have a lot of experience underneath my belt and look forward to speaking with everybody today and kind of walking through some of the information we’re going to provide. And before we get started, we just want to tell you a little bit about ourselves. One in four companies in the US use us for ACA reporting, and we have mitigated over six fifty two million dollars of penalties. Kelly is an expert at mitigating penalties, which she’ll talk about that a little bit in this webinar. And everybody, almost everybody that you get to help you with your ACA at Solaris have been here since the inception. Okay, we’re going to start it off with a poll. Let me go ahead and get that launched. Just so we can learn a little bit about yourselves today, What is your current status with ACA reporting? Are you a Solarix customer? Are you currently evaluating ACA vendors? Are you using spreadsheets and manual processes? Do you outsource to a third party vendor or something else? Be interesting to see who we have attending today. Yes. Okay, Kelly. It looks like twenty five percent are Solarix customers, so thank you for being here today. Twenty five percent uses spreadsheets and manual process, and fifty percent is something else. Gotcha. Well, for those using spreadsheets, we’re hopefully going to be able to help you out here and give you some information and kind of talk through that and help you find some better methods for managing the process that can be a little bit more effective for you. Okay, now Kelly will be speaking next about why basic ACA compliance is no longer enough. Absolutely, so for those of you on the line, probably know, you’re managing a lot more ACA complexities than maybe you have in prior years. ACA compliance really isn’t a when ACA first came around, everybody kind of looked at it as similar to when you file your return. You don’t think about it during the year. Look at it at the end of the year. You compile all the information and you’re done. What we learned over the course of time is that really there’s too much dynamic movement as it relates to employees. Employees are hired, employees leave, they change job classes. So there’s a variety of different activities that are happening. So it’s no longer looked at as just a year end process. It’s really a year round process. So it’s a proactive process that you manage throughout the course of the year and manage a variety of different responsibilities. So you’ve got workforce changes, acquisitions that might happen during the course of the calendar year, employers who have a high volume of variable hour employees, maybe that they need to do some type of measurement of hours for those folks. Again, as I mentioned, rehires and terminations, we’re looking at affordability changes as maybe from a plan year to plan year, changes in those affordability calculations. Anybody who on the line who might have medical plans that are self insured or level funded, having to deal with COBRA and retiree populations. And then you can kind of add into any of the state reporting requirements. So if you’re in a state or have employees who reside in one of the states that have their own individual mandate, you’ve got the additional layer of the federal side, but then you might have to do some additional state level filing. And then you can kind of compound that with the potential for IRS notices or penalty exposures with that increased complexity in that environment. The questions that you really need to start asking yourselves is, can you defend yourself with the decisions that you make on these various areas to make sure that you’re filing and reporting in line with what the IRS expects and reporting accurately? So when you’re trying to build a strong strategy for the regulatory side of things and the compliance side, All of us know on the line that the IRS really believes that if you can’t prove it and you don’t have it documented, it didn’t really happen. So some of the big things that companies really need to look at is from the reporting standpoint, you obviously want to be able to produce your forms, submit your filing, and meet the deadlines. So those are the big benchmarks. But in between, you need to make sure you’re able to have some type of system or methodology to validate the information. So prior to producing forms and doing the filing, you want to be able to review your data, have an opportunity to review it. And we always recommend for our clients here to do more of a proactive approach in the review process. So instead of looking at ten or eleven months at the end of the year, taking it in smaller chunks, maybe looking at it on a quarterly basis, reviewing each quarter, just making sure all that dynamic activity we talked about on the prior slide, new hires, terminations, life events, status changes, all of those different things that happen through the course of the year, that everything looks as you would anticipate in whatever system you’re using to manage that eligibility and status tracking for your employees. So being able to proactively review that, identify errors earlier. So if you find an issue or there’s an error, you have an opportunity to fix it during the course of the calendar year instead of waiting to the end of the year and correct any of those types of discrepancies. Monitoring, obviously a huge thing. You want to be able to keep your eye on the ball. So if you’re having to track maybe variable hour employees, making sure you’re tracking their hours of service and you’re doing that proactively to make sure should you have an individual who becomes eligible as a result of meeting that hours threshold, you’re able to act on that and make the necessary offer to stay compliant. Identifying any risks long before the filing season ends. So again, that proactive approach of touch points during the year gives you the opportunity to sort of right the ship if you find something’s going askew instead of waiting till the end and maybe missing it because you’re trying to rush to get the filing done. And then obviously audit readiness. Again, as we talked about, if it’s not documented and you can’t prove it, it didn’t really happen. So you always want to make sure whatever method you’re currently using, or if you’re looking for a new vendor, the questions that you really should be asking is, do you have the ability to maintain defensible records? Do you have the ability to house and archive any measurement reporting that you’ve done? If you’ve been doing some type of look back measurement, for example, are you able to archive and keep those reports indicating that you’ve measured those individuals consistently and what the results were from those measurements, along with all the document decisions that are made, whether somebody actively enrolls, making sure you’re tracking all of that and then capturing any waves, if an individual waves, and being able to have that historical information when Peggy Sue is hired as part time, she moves to full time or vice versa, that you’ve got those documented events so that you can prove how the code combinations might result because of those types of changes. You always want to be able to have everything you need to respond to the IRS should they come knocking. So that’s going to be a consistent theme that you’re going to hear throughout the webinar today about ACA is really a year round process. I think for some folks that can be a little intimidating because it sounds like, well, I have to touch it every five minutes. It isn’t one where you have to be that micromanaged about it, but you definitely want to be able to have some soft touch points during the course of the year, again, to make sure everything is happening the way you would expect. If there are issues, you have the ability to resolve those issues, get those back on track long before the year end. Those acts that you do through the course of the calendar year really makes a huge difference at the end of the year. As the client, you’re not stressed trying to figure out, have we done everything? We checked everybody, did we look at everything? You have the ability to feel confident that you’ve had the opportunity to look at people, making sure things are correct and make any changes that are necessary. So you’ve got a monthly cadence that you can look at as well, making sure you’re loading and reconciling your payroll. Again, that’s really big on clients who have a high variable hour population that you’re having to measure and do any calculation for the hours of service, tracking those hours and doing that measurement process. But it’s also important when you’re looking at the affordability factor. Depending on what safe harbor method you’re using, you’re going to want to make sure you’re having all of your payroll and details and information accurate, along with your benefits data. Obviously, with the ten ninety five reporting, you’re going to want to be able to make sure you’ve got the correct code combinations associated with individuals who actively enroll. But that would also apply for self insured or level funded groups who have to also report on Part three. So not only your employee who enrolls, but tracking if they enroll a spouse or dependent, what months were those individuals covered and making sure you’re capturing those details as well. Your new hires terminations, making sure you have a consistent method for managing your demographic details. Peggy Sue was hired, Peggy Sue was termed, Peggy Sue moved from full time to part time, a way to track that historical work history events for those individuals because that’s significant in what code combinations could potentially shift based on those types of changes. Quarterly, you’ve got, again, that quarterly cadence. This is really where we encourage our clients to do reviews of the ten ninety five C data and the code combinations and looking at individuals just to make sure that the codes are looking as they expect based on the status of individuals as we go through each of the quarters. Again, if we find some issues, that’s where we have the opportunity to work with the client and make sure we get those things resolved, any updates and changes that are necessary put into place long before the year end. It also helps to just validate and make sure that EIN numbers are accurate. So the exact company names for those particular employer identification numbers are correct. If you acquire a company or maybe one of your company locations with their own EIN number has closed and that company is closing, making sure you’re looking at all of those things during the year should those events happen. Again, and creating that audit trail and making sure you’ve got things documented and then being able to escalate any unresolved issues during the course of the quarter. And then lastly, before filing, obviously you want to confirm your status. Are you an ALE? Are you an aggregated or a control group? How should that reporting happen? Ensuring you have an opportunity to review not only the ten ninety five C forms for employees and spot checking those and making sure that information looks correct, but also looking at the ten ninety four before that filing is submitted. So whether you’re managing it yourself, if you have another vendor, or you’re a Solarix client, making sure you’re taking the time to look at that ten ninety four before the filing pushes, just so you’re sure that all the information is correct. The address is correct, contact information, company name, all of those pieces of information. For those of you on the line who are Solaris clients, you have a dedicated ACA client success manager who can help walk you through that and kind of keeps you on pace with the cadence that we like to use here and making sure you have the opportunity to review that information long before the filing. Obviously, you want to make sure you’re completing any penalty risk or coded audits. So we want to make sure you try to reduce any of the possibility to have any type of IRS notice related to any of those types of things. So looking at that information and then documenting any changes or corrections that you make on the files as well. Okay, now we’re going to go through building an audit ready compliance program. Excellent. Alrighty, so what should you monitor during the year? So we’ve talked a lot about that here and kind of bringing that forward. So moving from just looking at the annual reporting, so just the forms and filing process, what should you be looking at during the course of the year that really is the foundation for the forms and the filing that you do at the end of the year? So employees approaching their full time threshold. Again, so if you’re a group who has a high volume or volume of variable hour employees, so you’ve got some folks who they’re not eligible for your medical plan or they might be eligible and that they’re offered the coverage at maybe a higher premium than your traditional full time folks. And this would be a classification of employees that you want to measure their hours during whether you’re choosing to use a monthly or a look back method, twelve months, for example, making sure that you’re really looking at these folks, monitoring those hours, measuring it. Once the measurement’s completed, making sure anyone who meets that full time hours threshold, that you’re extending that offer of coverage as required and then documenting that type of information and making sure you keep line of sight on not only those in an initial measurement, but ongoing as well. And then again, really important documenting the measurement results once that offer is made, if that individual chooses to either actively enroll, making sure you have the opportunity to do that or to waive that coverage, and then again, documenting that. So employees, let’s see, payroll and eligibility data discrepancies. You certainly want to make sure that when you’re really doing the hours of service, you’re going to want to make sure that you have a consistent process for loading the hours of service that are used to do the measurement. So you’re going to want to make sure that there aren’t any gaps in hours that should be used to do the calculation, because if you make an assessment and maybe somebody’s missing a payroll or two, that could be the difference between whether somebody becomes ACA eligible or not. So you’re going to want to make sure you’ve got a good, consistent process for that and then tracking the eligibility again as well. Re hires and breaks of service. So just sort of having some type of administrative practice on what you do for an individual who leaves and is rehired. We have some organizations who say, if you are rehired, you were eligible and you were rehired within thirty days, you don’t have to do a waiting period. You can start first the month following that rehire date. But then there are others who have a different approach. You just have to make sure what your organization’s rehire rules are and then understanding the break in service and what the IRS guidelines are for that and making sure that those two are in line so that you’re maintaining compliance there. An important thing there is really to make sure whoever using that to support the ACA process and the compliance requirement, that you really have a good partner with subject matter experts that can really help guide you in this area, because that’s really an area that can get a little confusing for employers and can be sometimes difficult to navigate if they don’t have anybody to really help outline what that should look like. And then again, self insured coverage populations, just really making sure you’ve got not only your employees, but you’ve got any covered dependents that they might have on coverage so you can populate the forms accordingly. And then also keeping line of sight on any COBRA continuation for medical or retirees that are offered group coverage. So for self insured and level funded plans, you’d need to report on them as well. So the question to ask, can your current solution show emerging compliance risks long before you generate the forms? So do you have a system in place, whether you’re doing it manually, you have another vendor or whatever process you’re using internally, do you have a system in place to be able to bring to light any issues that are emerging or if there is a failure in a pay history file to load, do you have some type of methodology that tells you, hello, that payroll file load, so those hours didn’t get populated, we need to take a look at that. So those are the things you need to kind of look at whether you’re managing it internally, if you’re looking to find a new vendor, as we do with our clients, we have all of the systems in place that kind of flag those things and bring those things to light that allows us to work with clients on making sure we mitigate any of those risk factors that we might find during the course of the calendar year. All righty, so affordability and penalties. So these are the numbers that really kind of deserve your attention. So as we look through for twenty twenty six, you can see the affordability threshold percentage, but then you can also see where it’s indicating what the penalties are for the penalty A and penalty B. So those penalties can be pretty significant, particularly when we’re looking at by person, by month and how those can kind of compound. And so it’s really important that from a compliance standpoint, that again, whether you’re managing it internally, you’re seeking a new vendor or using a different vendor, that you have some type of cross check and support from a compliance expert to help make sure that the organization is keeping their eye on what the lowest cost premiums are, what safe harbor affordability method is being used, any changes in the payroll, anything with the entity, your employee populations, things like that, that you’re looking at all of the factors that are necessary for managing the affordability in order to eliminate any potential penalties based on those those types of failures. So affordability requires more, again, more than just a year end check. It’s one of those things that you’re looking at during the course of the calendar year. Particularly if you have groups who are non January one benefit plan year, they may change, they have a different benefit plan year mid calendar, you’re gonna wanna make sure you’re looking at what those affordability thresholds are based on any changes there. And ensuring that you’re applying the selected safe harbor affordability method, right? So some employers get a little confused about which method to use, which methods they can use, if they can use a different safe harbor affordability method for one group of employees versus another, And that’s where it really comes into having a good compliance partner who really understands what the IRS guidelines and regulations are and what you can use to kind of help you better understand what you’re allowed to use, what the best practices are, and then can kind of figure out what to do for your organization. Accounting for compensation changes, you want to track contribution changes, review affordabilities across all populations, and then understanding why an employee passes or fails an affordability test. Making sure that whatever system that you’re using to do those calculations, understanding what the criteria is within that system and what information it’s using to do the affordability calculations and that all of that information is there. So you definitely want to treat affordability as an ongoing monitoring activity and not just something at the end of the year. You always wanna make sure that your employee census and demographic information is fully populated, whether it’s the annual salary or hourly wage, whatever method you’re using there is populated. So those are really some key things to keep in mind. And documentation, as I mentioned, is the best practice, documentation, documentation. For those of you on the line who have had an opportunity to work with me over the course of the last decade or so, many of you will know that I am famous for saying, but did you document? So that’s something I say often. It’s a really an important part of the process, making sure that you have proper documentation for the employee hire dates, that you’ve got that, that you have it in your system and it’s documented, their classification, their eligibility determination, what’s the waiting period? If they’re a variable hour employee, what’s the measurement method that you’re using for that particular classification? Was the employee full time and then they met the waiting period and then the offer of coverage was extended. So when was that done and what did the individual do with that offer? Did they waive or did they enroll? Making sure you have those things documented. Measurement and stability period records. This seems to be an area that employers really seem to struggle with. They can get down the measurement process, right? Somebody has been measured through a twelve month look back, for example, and they became ACA eligible as a result of meeting the hour requirement, But remembering that there was a stability period. So there’s a period of time in which that individual is locked into that full time status, and it doesn’t matter what their hours are during that stability period, they’re still classified as ACA eligible, right? So that they still have the opportunity to enroll, to maintain medical until you do that next subsequent measurement. So again, this is where having a good ACA expert and compliance partner in understanding what the rules are for the measurement, how the measurements work, how the stability periods work, and how all the dynamic changes in that process should be managed in order to make sure you’re staying compliant. And then lastly, those employee waivers or elections. Again, having a good system system of record or management process for tracking that. When someone waive or when they have the election or if they have an election and then they change their coverage, they move from employee only to employee plus family, and you’re a self insured or level funded plan and you have to populate part three, you wanna make sure you have the changes that include those covered individuals as well. So your internal ACA audit checklist. So here are some things long before the season. So we’re rolling in towards the end of September, we’ll be rolling into the fourth quarter before you know it. So here’s just a few things that you need to ask and kind of have a checklist for yourself. So are employee classifications accurate? This seems to be a big area where we find when we’re doing compliance work and working with clients who have received an IRS penalty notice, lots of times it really is the root cause many times is that they’ve really classified their employees incorrectly or not understanding what those classifications mean. So when someone is classified as full time, what does that mean as full time? If someone’s classified as part time, what does that mean as a part time individual from the ACA compliance perspective? And so really understanding what those classifications are and who those employees are within those classes. Are measurement periods documented? So understanding what measurement method you’re using and what those measurement periods are. So what your initial measurement period is, which is the point in time in which someone is newly hired and they have that first measurement period. And then any subsequent measurement, which is typically a standard or annual measurement that’s done thereafter, knowing what those dates and what that period of time is so that you can be consistent in doing that measurement. Our offers of coverage tracked, so you need to make sure you’re tracking those offers of coverage when that was done and then what that employee did with that offer. Can affordability calculations be reproduced? So do you have some type of method that is tracking Peggy Sue, here’s Peggy Sue’s salary, here’s what her offer of coverage for the lowest employee only cost was, here is what that particular reporting year’s percentage threshold is and the calculation. So you want to be able to have a system in place that tracks that from year to year as to what the calculation was, how it was done and what the results are to indicate that they’ve passed so that should you get an IRS notice. And as many of us may know that the IRS is usually about two years behind. So if you’re reporting for twenty twenty four, for example, those folks, anybody who might get an IRS notice are just now starting to get those notices. So you want to be able to have the ability to go back a couple of years and say, okay, here’s Peggy Sue, here’s what we used, here’s what her salary was, here’s the calculation, and here’s how we can prove that the offer of coverage was affordable, as an example. Can you explain what line fourteen and line sixteen codes are and how that applies to the individual? One of the things when ACA first came around and we started kind of understanding what the code combinations were for line fourteen and sixteen and trying to learn what they all were. As time went on, we started to realize that eventually for us who do it all the time, it literally becomes like a second language. I can look at someone’s code combinations from January to December, and based on the codes, if the codes are correct, I can tell you what happened with that person. Peggy Sue was not an employee. She was hired in February. They have a thirty day first of the month following waiting period. And then so she, in February and March, she would be a 1H and a 2D, so you can follow it along and see the course of what happened with that individual. And it’s the same from the employer perspective. You just want to make sure when you’re looking at folks, when you’re looking at line fourteen and sixteen, which is fourteen is, was there an offer of coverage? And if there was, what was it? And then line sixteen kind of tells the story of, if there was an offer of coverage, what did that employee do with that offer? Did they enroll? Did they waive? Or if there was no offer, why? They weren’t an employee, they were in a waiting period. That type of story, you’re going to want to be able to understand if those combinations match what’s happening with your employees and understanding what those codes mean. And again, having a partner that can help you navigate those waters, because we certainly don’t expect employers to necessarily know it the way we know it. We do it all day, every day. I’m a complete nerd when it comes to that type of thing. So not everybody knows it, but having that type of partner that can help you better understand, are these codes right? This is what Jane did. Does this look the way we should expect? That type of thing. And so lastly, the ACA IRS notice. The big question always becomes from year to year. You never want one, but are you prepared should one show up in your mailbox? Okay, now we’ve reached the evaluating your ACA compliance solution. So ACA compliance requirements, it’s more than really just a filing tool. Obviously, technology that can be used now is amazing. You can really do a lot of the heavy lifting. And so those are the kinds of questions that you really want to ask yourself if you’re looking for a vendor or if you have a vendor and you might be making a change to a new vendor or if you’re just doing it internally. You really kind of want to look at what tools do we have and what resources are we using to really make our compliance strategy the strongest it can be. So typically what we see as sort of a light tool, which is really more of just the reporting tool that allows you to input the information and generate the forms. It doesn’t really proactively flag errors and things like that. It’s really more of a, you put the information in and it just sort of spits it out. A true compliance strategy is really where you have a tool or a vendor or a partner that helps you monitor the eligibility year round, that helps you sort of navigate the changes that we’ve talked about earlier in the webinar, where people are new hires or they term mid year or they’re rehired or they have a job classification change, really helping you navigate those waters to make sure that everything is in line with how the code combination should look and that how the data sets are coming over. Validating the source data and making sure that the codes are matching for what happens with those individuals. Able to document decisions and corrections that are made. A way to have a system that archives historical information on individuals from years back, whether it’s the work history records for those individuals, whether it’s their enrollment or their measurements, things like that, being able to have historical archived information. And then also prepares not only the IRS forms and filing for you and worksheet through that process and making sure that those are completed by the deadline and within the timeline requirements, but also can help you prepare an IRS response package should you need it. The big thing is a failure to plan is a plan to fail. So the big step is you always want to be able to be prepared for that notice that comes in the mailbox, but the hope is that you never get it. Right. So you just mentioned this. Yes, yes. So an easy access to historical data, as I mentioned, we’ll talk more about, the IRS penalty notice and things like that as we kind of get a little bit further into the webinar. But one of the things that I mentioned is that the notices aren’t an immediate. It’s not like if you complete the twenty twenty six reporting year that all of a sudden in early twenty twenty seven, you’re going to get a notification from the IRS that says, hey, this doesn’t look quite right. It’s going to take them eighteen months to two years before you get anything from them. So you have to be able to have a vendor or a partner or a system or a process or method that’s going to allow you to easily access historical information. Because that’s the key to a successful appeal process is to be able to go back and provide the documentation and reestablish what should have happened. Oh, there was an error in Peggy Sue’s record. This is really what happened. So these are the codes that should have shown for Peggy Sue. And here’s the documentation that we have for that. That’s the best course of action to do the appeal and to try to get the best results from having any of the penalties medicated. So you’re always gonna wanna have access to prior year forms. That’s the ten ninety five C forms as well as the ten ninety four. Any archived filings, employee history, again, work history, measurement reporting that you’ve done in the past, coverage history to include any covered individuals if necessary, affordability calculations and results. Again, as I mentioned, the measurement period results, so the measurement method that you’re using, the results from that particular period and what the end result was for the individual, any corrections that you might have made, and then any other supporting documentation that you might have from year to year. So you’re going to want to be able to have that information. And so that’s going be really important for you to be able to build a good compliance toolkit that will allow you to reply to any IRS notice should that come your way. And doesn’t this come up a lot, Kelly, if they get a penalty from two years prior and say they don’t have a system and it was a different payroll that they use now, doesn’t that happen a lot? Yes, yes, happens a lot. We see a lot of that’s a great point, Robin. We see that a lot where a lot of the clients that I work with that have received IRS notices is they’re clients of ours now, but two or three years ago, they used another vendor where there was another method that they use and they’ve gotten a notice. And our job is to try to help them submit an appeal for that and try to get the best results. But many times they just don’t have access to that system anymore. They never pulled or archived that information and things like that. So it’s really important that you have a system in place. No matter what company you’re using, you can have it in their system, but you should always, and we always tell our clients, you should always download and archive all of those details and have it listed internally at the organization level. It’s sort of like your own personal tax return. Your accountant might have a copy of it, but then you leave with this thumb drive or stack of papers of your information that you take with you that you own. And employers should do the same. You always want to have a vendor that you have easy access to be able to get to and that type of thing. But you always want to have all of your information accessible at the group level because things change. And talking about that, how about, there we go. Yeah, so bringing data from multiple systems together, right? So when you’re doing your NCA reporting many times, even with the clients that we work with here, they may use either a standalone or integrated system for their BEN admin as well. And so they have a majority of information in the enrollment system, but they may use a different payroll vendor that’s pulling in the hours of service for them to do their measurement calculations within our enrollment system. And so you just want to make sure that the systems that you’re using can connect with each other in an efficient, streamlined manner. If you have an API connection, those are typically the best. But whatever extract, if it has to be an extracted import in that’s working and you have a consistent cadence in which that information gets into the system you’re using to actually do your ACA reporting, your measurement, your affordability calculations, and all of those types of things so that you’ve got all of the information that’s necessary. One of the big gaps, lots of times that we’ll see when we are onboarding new clients and they’re coming from another vendor and other systems, is you can have a gap in employee information from one point in time to another. So if they were to onboard with us, I don’t know, let’s say July first, we wanna make sure that we get all of the employees that were active anytime during twenty twenty six, for example. So even if Jane was an employee from nineteen eighty two, but she left in May of twenty twenty six, she was a full time person, we would still wanna capture all that information for her all the way through. So it’s gonna be really important that you have the ability to monitor those things. And then again, access to an ACA expert. Having a partner or a vendor who understands the IRS’s guidelines and expectation for how the process should be managed and different scenarios, how to treat those scenarios and can kind of help walk you through those. One who can help respond to IRS notices, corrections if they’re necessary, and things like that. So that’s really important, having an EHA expert. So questions every employer should ask. We’ve talked about a lot of things up to this point, but lots of things that are really going to be that ACA solution stress test, the thing that you should ask when you’re looking for a new vendor or your current vendor. Do you have data and integrations for your system? Can you trace each of the ten ninety five C codes back to the source? How did the system get these code combinations for Peggy Sue? Monitoring, do you have the ability to monitor what’s happening, bringing forward red flags when there’s invalid code combinations? How are the affordability calculations being calculated? What’s the model for that? How is that information happening? Governance, what is happening for the approvals, the exceptions, corrections, user history? Support, what type of support do you have? Do we have an expert to interpret issues, deadlines? Should we get a notice that can help us with that? And then can you handle things on scale? So as companies grow and have acquisitions or multiple EINs, a large population of variable hour employees, these are all those types of questions and areas that you would need to kind of ask and stress test your vendor to make sure that they can manage that process. Okay, and now we’re going into our very last section, preparing for IRS scrutiny. And we’re going to start this one off with a poll. I’ll go ahead and launch it. How confident are you that your current ACA process will withstand an IRS audit? Are you very confident, somewhat confident, not very confident or we are not sure? I’m hoping that everyone says very confident, but if not, we can try to offer some guidance on areas that they could take a look at. Okay, we did get seventeen percent are very confident. I’m hoping those are our customers. Sixty seven percent somewhat confident, not too bad. Seventeen percent not very confident. So we hope we’re helping you with Absolutely. And so those who are not very confident, after the webinar, you can certainly reach out to Robin or myself and we can if there’s anything we can assist you with or any other questions, we can certainly see what we can do there. So this is the dreaded penalty letter. So the most common penalty letter that we see there, there’s a few of them, but the most common is the two twenty six J notice. And essentially, this is a letter from the IRS that’s indicating that there could be a proposed penalty. So they haven’t actually issued the penalty and you haven’t been assessed. It’s just indicating that based on the data that you provided, the ten ninety four C, the ten ninety five C data, or someone has, an individual has gone out to the marketplace to receive a premium tax credit. Based on those different factors, they have indicated that it appears as though the employer could be subject to a penalty. The notice will kind of outline a variety of different explanations of what the different areas of the penalties are. And then they provide you details on what individuals that they are addressing or have questions about for the code combinations. Or if they have an issue with the ninety five percent offer, they’ll indicate which months appear to be failing. These are the types of notices that, don’t panic, first and foremost, you need to open your mail. There’s definitely an opportunity to appeal and potentially get them mitigated. Again, if you’ve got all of the things that we talked about up to this point, documentation, you have the information and you can go back and lay all of that out. And I love this one, Kelly, because Kelly assisted with this herself. This is impressive. I did, I did, yeah. And so this was a very large hospital that we had that received a 226J notice that came to our compliance support team for help on it. And it really, I mean, as you could possibly imagine, when they opened the mail and you get this notice with this huge number in there, how that could just send everybody into a tailspin. So it definitely took everybody back, but once we stopped and had the opportunity to meet with them and review what the IRS notice said, what the IRS was indicating was the issue, we easily got to the root cause of the problem. There was an incorrect representation of the offer of coverage and the codes, which then triggered issues on the ten ninety four. Once we were able to get the documentation, all the information and help them generate the appeal response, the IRS mitigated the penalties because again, it was really, they hadn’t done anything wrong, it was just represented incorrectly, which again goes back to when you can do it year round, you can try to catch some things ahead of time if you can. So if you receive a penalty letter, what should you do? First of all, you need to have a method in place for when anything comes from the IRS, what is the process? Who opens it and it gets to someone? Don’t leave it in an inbox or anything like that. You’ve got to open the mail because it has a time limit to it, right? There’s a clock, So when you receive it, it needs to get routed to someone open and routed. You need to find either whether a legal consultant or a compliance support team or someone to help you sort of understand what the notice is saying and really where the areas are that they’re identifying that could be leading to the potential penalty. You’ve got to reconstruct and pull together what really happened for those individuals or for that particular reporting year. You’ve got to analyze it, compare the information, respond by the deadline date. The IRS is very particular about how you respond, what you respond, and they have sort of a, they have their own love language, if you will, on how when you write a response letter and a statement, sort of the things that they want in there and having a good partner to help you with that is invaluable. That’s what I do here and it can make the big difference. So all of those things are important. So questions to ask your current ACA provider. We’ve talked a lot about these, but some big things, how do they identify compliance risks before the season ends? How are rehires and breaks and service handled? And I’m just hitting some of the high points here. How are corrections managed? What support is available? Should you get an IRS notice? And then what information can you access from prior years? So there’s a laundry list of those, but those were just some of the ones that I just mentioned now, but we talked a lot about what these are. So again, keeping a stronger year round ACA operating model. So again, just kind of looking at changing the mindset of ACA is just something we do at the end of the year, that you really have to have more of a proactive approach to it. Again, you don’t have to do it every day, all day, but at least having a quarterly cadence of making sure you’re reviewing the data, looking at the code combinations for individuals during that timeframe, reviewing all of the information, making sure you have the ability to proactively manage your employee information that’s coming in, any affordability calculations during the year, your measurement process, how that’s happening and making sure you’re managing that part as well. So just kind of having a quarterly cadence so that long before you get to the year end and preparing to do your forms and filing process, you are confident in that you’ve had the opportunity to look at things through the year, clean up anything that you might need to, redirect things if it’s been necessary, and that at the year end, you’re just sort of doing an overview and then being able to file. And what should everybody be doing this month? So three actions to take this month. So as we roll into the end of September and rolling into the final quarter of the year, you wanna again, test your audit trail and making sure, just pick a random employee or a couple of employees and sort of walk through what their code combinations look like. Here’s what Peggy Sue was hired here. Here’s what’s happened from January to the end of September to September and kind of track and make sure that whatever code combinations happen on pre populated form, a preliminary form matches what’s actually happened with her and that you’ve got the right information. All of her details are in there. Review your risk reporting. So if you have any proactive reporting that can populate any risks that it identifies if it surfaces any invalid code combinations, failure of affordability, things like that, that you’re looking at that and acting on that and getting with your vendor partner, or if it’s an internal client, if you get with your dedicated ACA client success manager to work through those things. And then challenge your vendor, ask the questions that we posed today. So ask them some of those questions, ask the hard questions. They should be able to answer those and direct you to where within their system or what method that they use to help you in those areas. And if not, that is an opportunity for you all to reassess if that’s the approach that you want to take or how you want your compliance strategy to look. Okay, and we’re going to end with a poll. Let me go ahead and launch our very first last poll. Did it launch? It’s not pulling up. No. Oh, here we go. What’s your next step after today’s session? You’re going to review your ACA process internally, look into solutions to improve accuracy, discuss with our team, no immediate next steps, Are interested in more information. Okay, sorry about that. Zoom was very slow with launching it. So, here it is. There it is. And I won’t go over these answers. Kelly and I will keep these to ourselves and we’ll know how to follow-up with everyone after. But I’ll leave it up for a second. And this is just a little bit more about Solaris and what we do. So, do have two solutions. If you don’t know, you can come to us from any payroll from any bin admin and you’ll be in our standalone ECA. Or we have our own bin admin solution. So, you could choose our BEN admin solution and everything for ACA will be integrated with that solution. And we have IRS defense and you can just look at all these things that we do. Go ahead. And now we have our questions. You can go ahead and pull some of these resources. I will be sending these resources in the recording email, and you could also scan for next month’s fun Halloween webinar. But now we’ll be taking some questions before we wrap up. Let’s see, Kelly, if we receive an IRS penalty notice for a prior reporting year, what records should we be able to pull quickly? So it really kind of depends on what type of notice you receive. So if it’s a two twenty six J notice, I think the first thing you’re going to want to look at is determine whether or not the IRS is indicating if you’ve met the ninety five percent. So if you want to make sure you pull your any type of ten ninety five and see forms for that reporting year for all your employees. The fourteen thousand seven hundred sixty five will typically list a variety of, it’ll list some employees and those are the ones you want to focus on first. So you’ll want to pull their 1095s. You’ll also want to pull your 1094C for that reporting year. And again, depending on what the notice is kind of focusing on, you’re really going to want to look at how your ten ninety four was submitted. Did you meet the ninety five percent requirement for all twelve months for offering coverage, or were there specific months that you did not? You’d want to look at your employees for those particular months and kind of make that deduction. I really would recommend you trying to, if you don’t have a compliance team internally or a legal counsel that you can reach out to, that you can certainly, we certainly have a Compliance Connect department here to kind of get some guidance on what your notice is asking for to help guide you in the right direction. And for the people that answered in the very beginning, they’re searching for a vendor. What would be your advice, Kelly, on when you should make that decision since it is September? Sooner than later. It’s one of those things that it’s because we’re getting into the fourth quarter, sooner is better than later, right? But if you still need a month or two to try to figure it out by October, November, and that’s kind of pushing it, but it’s certainly doable and we can certainly do it. But I definitely think if you’re on the fence and you’re really trying to decide to get more information, if you want more information about the services that we offer to really reach out, let us kind of walk you through what we can offer to make those decisions. Perfect. And I want to thank everyone for your time today. Kelly, thank you for a wonderful presentation. And you know, you can reach out to us for any additional questions. We hope to see you next month. Thanks, everybody, for joining.
