Healthcare Reform Brings Administrative Burdens for Businesses
Now that Healthcare Reform has been signed into law by President Obama, Florida-based small businesses are understandably asking: “What does this mean to me?” The ultimate answer to this question is complex and depends on a variety of factors related to the business in question. These factors include the number of full-time employees, industry, current health coverage, business objectives and more. There is, however, one indisputable area which will impact all businesses – the significant administrative burden that will be required to navigate the new regulations associated with Healthcare Reform.
Incentives and Penalties
The legislation has broad implications regarding the future of healthcare in the United States, and is structured with employer-based financial incentives and penalties to help ensure that the new mandates are properly implemented. The key for any business to successfully navigate this new legislation will be its ability to optimize these incentives and minimize any risk or penalties. Said another way, the ability to turn incentives into financial opportunities, e.g., tax credits, and penalties into completed administrative tasks, e.g., reporting requirements, can make a substantial difference in a business’ ability to remain an employer of choice while ensuring the integrity of the bottom line.
Due to the complex nature of the healthcare legislation – which includes specialized government reporting and employee notification – it will not be an easy task to accomplish for most businesses. This is especially true for small- and medium-sized businesses that do not have the manpower or infrastructure to adequately understand and fulfill the mandated requirements. Larger businesses with the in-house information technology systems and employment-related services that can assist in meeting the requirements will be better positioned. Small- and medium-sized business will not likely have access to a comparable level of internal resources. Efforts to meet the substantial administrative mandates could result in less time being spent on key business activities and/or increased cost for the business. Under the new law, mandated employer administrative tasks run the gamut from 1) having to calculate and report the aggregate value of employer-provided coverage on each employee’s W-2, 2) providing statements on “Minimal Essential Coverage” to the IRS and covered employees and 3) providing written notice regarding the existence of the insurance exchange(s).
Partnering Can Help
Despite these significant challenges, help is available. Employers can utilize partners with specific expertise in these areas. Outsourcing some or all of the administrative tasks associated with the legislation can help ensure that requirements are met, all appropriate credits are received and potential fines and penalties are avoided.
Partners will need to have expertise and access to critical employment-related components impacted by the legislation including in payroll and related taxes, employee benefits administration and human resources services. These services can be individually outsourced from various vendors or a comprehensive Professional Employer Organization (PEO) that coordinates and provides all of the aforementioned services can be utilized to help ensure that key activities are handled in an accurate and timely manner.