It’s June, and the 1094/95 filing that most of us thought would be history by now is still a work-in-progress for many. Having completed filings for nearly 2,000 employers (ALEs) in the 1st quarter, I thought this would be a great time to share the lessons learned that can inform us for next year.

1) Advanced planning paid off. Because ACA reporting is a year-end snapshot of your business, final data becomes available just weeks before the deadline for getting forms to employees. To avoid a mad scramble in January, we had our clients run a test file with 10 months of data, in November. This trial run provided employers with valuable insight to their data quality, unusual employee situations, and an idea of what to expect with the filing process. This gave them plenty of time to resolve issues, making January almost anxiety-free.

[Image credit: Bloomberg]
[Image credit: Bloomberg]

2) Great source data is key. Clients with clean data breezed through the implementation process, while clients with data challenges took weeks, and sometimes months, to file. Why the difference? Because incomplete/inaccurate data was by far the most significant driver of filing errors, IRS rejections and staff hours needed to complete the filing. Now’s a good time to evaluate your system in advance of next year’s filing. Does it properly track everything you need, including coverage waivers, rehire dates, Cobra and leaves of absence?

3) Validate before filing. Seems logical in hindsight, but some clients just entered their data and hit the “file” button. There is an important interim validation step that highlights patterns in the data you won’t see otherwise, and gives you an opportunity to make adjustments. A small investment of time here will save countless hours and the expense of correcting and re-issuing forms downstream.

4) Don’t surprise employees. Just as this was new for all of us, it was new for employees, too. There were questions about purpose, timing, what the codes meant and what to do with the forms. Clients who took steps to engage and educate their employees saw good results. A simple communication with an explanation of the B and C forms and IRS codes reduced questions and anxiety, and reflected well on HR.

5) Prepare for corrections. Through our own filing solution, HealthCostManager, we completed electronic filing for our clients and are now helping them correct forms that the IRS rejected. IRS rejections will probably never go away entirely, so you might as well plan for them. However, since 6-8% of this year’s rejections were due to a mismatch between employee name and social security number, one thing you can do now is to confirm that you have the full, legal name and correct SSN on file for every employee.

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