Staffing Exchange: Does the Shoe Fit?
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ACA and The Staffing Exchange
Staffing companies recently began receiving ACA subsidy notices. This could mean bills for non-compliance are just around the corner.
The Staffing Industry Analysts (SIA) annual survey of temporary workers has some alarming news in it. It indicates that a whopping 48% of temporary workers are buying the Affordable Care Act in the exchanges. The rate is 55% for commercial staffing. That’s potentially horrible news for staffing firms who have rolled the dice and opted for a Minimum Essential Coverage (MEC) only plan.
Here’s the scary part: Temporary workers’ uninsured population is half what it was just two years ago, so there’s ample evidence that suggests temps are buying coverage on the exchanges.
The SIA survey has been showing enrollment of temporary workers with the Affordable Care Act increasing each year. I expect the reason nobody has been talking more about this frightening data is the penalties haven’t been invoiced yet.
On a positive note, most of our ACA plans seem to be working smoothly. Among them is The Staffing Exchange (TSE), a group purchasing model exclusively for staffing companies. Early reports show the financial model is working well. Firms that have both their internal staff plans and temporary worker plans in TSE are generally seeing their internal staff and ACA plan costs run well below norms, with the savings accruing back to the staffing company.
One of the options with TSE is an auto enrollment feature that allows the employer to put new employees, as they qualify for coverage, on the lowest cost plan. In most cases, the lowest cost plan can be fully paid, or at least mostly paid, by the employee.
Another benefit of the auto enroll feature is it provides documentation of an offer of coverage. Some employers are informing employees during the onboarding process that if the employee chooses not to enroll, rather than being auto enrolled, they’ll be “auto waived,” and the employer is banking on this notice to suffice as proof of offer. If the State of Massachusetts (who had healthcare reform ahead of the ACA) is any indication, we may need to rethink that approach because Massachusetts only accepts a positive enrollment or completed waiver as proof of offer of coverage.
So, one of the options you may want to consider is auto enrolling new employees into a plan that costs you little or nothing. It can protect you in case of an audit, provide a level of coverage to employees and may end up subsidizing your ACA budget.
Source: Staffing Industry Analysis 2016 Temporary Worker Survey
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