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Staffing Agencies and ACA Compliance: The Struggle is Here to Stay!!!

Sean Cooper • Oct 27, 2022

Staffing Agencies and ACA Compliance: The Struggle is Here to stay!!! 


ACA Compliance reporting will remain in effect regardless of who wins the House and the Senate next month. If the Republicans win the House and the Senate, they have already commented that they are not concerned with repealing the Affordable Care Act (ACA). As recently as last week, Republican leaders commented that they have bigger fish to fry. There have been nearly 2,000 challenges in Supreme Court since 2010 and very little changes have occurred, which means The Patient Protection and Affordable Care Act (ACA, PPACA) IS HERE TO STAY! 

Pain Points of Compliance for Staffing

For the staffing industry, opinions are split in various directions but there is one thing that unifies all staffing agency owners and that is the pain felt by gathering the data, analyzing the current state of each employee month to month, and then documenting it for the IRS in the required format. As an owner, have you experienced this? Well, you’re not alone and looking on the bright side, there are tricks of the trade that will assist you in making this as easy as your weekly payroll.  

Tips to Follow

Data is what fuels the analytics that determine the correct codes for the 1095c forms and ultimately what drives the necessary information and calculations for the 1094c form, specifically Part III of the 1094c. Everyone knows good data in, good data out is the goal but oftentimes the opposite of that is happening. Poor data and reporting have become commonplace for staffing agencies, but it can easily be changed when working with an ACA reporting vendor.  

Starting at the beginning with hiring, it is imperative to gather the proper demographic and personal information from your new hire and confirm it is valid. Staffing agencies are challenged with language barriers, educational barriers, and high turnover. Revamping your HR new hire procedures will not only be the correct business decision, but it will make for more compliant ACA reporting. 

Categories of Concern for Staffing

Once the new hire has been onboarded, there are three common categories not properly maintained within the staffing industry: time, position, and working status. The main reason for this is bad record keeping. You may not be able to control all the information from outside sources, but the previously mentioned data categories are all created and determined by your company. Therefore, that data should be correctly recorded. So, why do your data inputs and outputs still include errors?

Change is sometimes difficult, but with a few minor updates to your current operating procedures it will put you on the path to great data. This will help streamline your processes and worries of a penalty from the IRS. By confirming that the data provided by your employees is valid, you will save time and resources. Some data points to review to help with compliance are:
  • Hours worked
  • New hire dates
  • Termination dates
  • Offers of coverage
  • Enrollment dates

As you embrace the changing culture of the staffing industry, you must also embrace the fact that the ACA is here to stay. Educate your HR team on Applicable Large Employer mandates so that you stay in compliance. Ensure you are providing affordable and timely coverage to employees on your payroll, accurately document various data elements, and set time aside each month to work on your ACA compliance. This will become a habit that will streamline the reporting process. The financial risk of being out of compliance is too high and continues to increase every year. 

We Can Help

 The best investment for your staffing business is to partner with a compliance-focused, and specifically health care-focused, solution provider. Outsourcing to a company like SyncStream will alleviate compliance risks because we have the knowledge of ACA regulations and understand how to interpret the requirements, as this is our seventh year of filing.





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