aca business strategies
TRANSCRIPT
ACA Business StrategiesWorkshop for Employers of Vulnerable Wage populations
Presented by: Rich Boehling
President and CEO of Productiv [email protected]
Hurricane Warning
Employer Shared Responsibility (simplified)
3
1 page22,700 pages
Paid Hours
Earned Wage
P3
P2
P1
L3
0
+
+
L2
L1
Earned Wage(Y Axis)
• Skilled and Professional “3”– 301% FPL and Up (over $34,470 W2)
• Semi Skilled “2”– 101% to 300% FPL (up to $34,470 W2,best cutoff for affordability)
• Disadvantaged Wage Class “1”– 0 to 100% FPL ($11,400 W2)
4
0
+
100%
300%
Earned Wage
A Census Grid Wage Band
Earned Wage
Medicaid Cutoff
300% FPL Cutoff
Wage Band 3
0
+
+
Wage Band 2
Wage Band 1
Paid Hours(X axis)
• Part Time – Less than 30 hours per week
• Full Time – Greater Than 30 hours per week
6
0 +Paid Hours
30
A Census Grid Wage Band + Time Band
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
Wage Band 3
0
+
+
Wage Band 2
Wage Band 1
Part Time Full Time
FIRST STEP: Are you Large?• For ACA sake, small only means “NOT Large”• Common Law Employer is defined by IRS Revenue Ruling 70‐630
• Think, “Who is the Pay Master” that is the employer
• Control Group aggregation rule defined by IRC 414
• FTE’s are Count of Full Time (S) plus Part Time (P) on pro rata basis
• Seasonal workers DO NOT COUNT in large employer determination
You are “NOT LARGE” until YOU say otherwise.
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NOT Large (“S”) Employer Grid
Paid Hours
Earned Wage
Part Time Cutoff
P3
P2
P1
S3
0
+
+
S2
S1
SeasonalWorkers
Determination
• Count FT Workers = S3 + S2 + S1• Count FTE’s = Total Hrs (P3+P2+P1) excluding seasonal workers* hours divided by 30
LARGE EMPLOYER if….
FT Workers plus FTE’s GREATER THAN or Equal to 50
*Note: Less than 120 days of employment for businesses with typical seasonality
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Large Employer GridSeasonality exclusion NOT applicable
Paid Hours
Earned Wage
Medicaid Cutoff
Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2
L1
Large Employer Grid
Paid Hours
Earned Wage
Medicaid Cutoff
Part Time CutoffP3P2
P1
L3
0
+
+
L2
L1
Part TimeSAFE HARBORSome exchange
eligibility
Large Employer Grid
Paid Hours
Earned Wage
300% FPL Cutoff Part Time Cutoff
P3
P2P1
L3
0
+
+
L2
L1
Part Time SAFE HARBORAll exchange
subsidy eligible
Large Employer Grid
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2
L1
Part Time SAFE HARBOR
Medicaid eligible
Large Employer Grid
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2
L1Full Time
Medicaid SAFE HARBOR
Large Employer Grid
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff
P3
P2
P1
L3
0
+
+
L2
L1
Current Employer Group plan is OK and
typically affordable
Large Employer Grid
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2L1
Full TimeAll Subsidy Eligiblew/ FINES
Hurricane Preparedness
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2
L1
SAFEHARBOR
Pay Strategy
Paid Hours
Earned Wage
P3
P2
P1
L3
0
+
+
L2
L1
Fine = (Sum of all
workers – 30) x $2000
Some Play Strategy
Paid Hours
Earned Wage
P3
P2
P1
L3
0
+
+
L2
L1
Offer Coverage
Offer not Affordable$3000 per HIX
enrollee
ACME PBJ170 FTE’s
ACME PBJ: 2012 YE
BASELINE: $216,000
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$216,000
PBJ Financial Results
PBJ’s Choice with a 6.5% Price Increase
*SOME PLAY may produce the lowest cost ifparticipation rates in HIX are low
IRS Delays Penalties til 2015!
• Will likely cause a few things1. Removes urgency, Employers may blink2. Exchanges open offering HUGE subsidies for
enrollees3. Your EID will be reported through the application
process “Appendix A”4. Every Appendix A completed in 2014 will likely
cost you $5200 pretax (as a Large Employer) in 2015
Productiv Inc Example
Paid Hours
Earned Wage
Medicaid Cutoff
300% FPL Cutoff Part Time Cutoff
P3
P2
P1
L3
0
+
+
L2
L1
L3 9
L2 135
L1 29
P3 0
P2 39
P1 206
End of Q1 2013
Paid Hours
Earned Wage
P3
P2
P1
L3
0
+
+
L2
L1
End of Q2 2013
Paid Hours
Earned Wage
P3
P2
P1
L3
0
+
+
L2
L1
Public Assistance for L2 Families
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L2
Small Employer
Paid Hours
Earned Wage
Part Time Cutoff
P3
P2
P1
S3
0
+
+
S2
S1
SeasonalWorkers
SAFE HARBOR
Outsourcingto
Get orStay Small
ACME Plant Location 1Group Population Map
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Think About Building a House
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ACME Performs Business CaseFor Outsourcing
General Contractor
Subcontractor Subcontractor
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L2S Position Conversion
Large Employer “L2” Positions Process Outsourcer
Paid HoursEarned W
age
Part Time CutoffP3
P2
P1
S3
0
+
+
S2
S1
SeasonalWorkers
SAFE HARBOR
Outsourcing Org StructureHQ
(Corporate)
Location 1Physical Plant, shop, store
Location 2Physical Plant, shop, store
Location 3Physical Plant, shop, store
Property, Plant Equipment, and Inventory
ProcessesCore Business & Management
Process OperatorSubcontractor
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PBJ Financial Results
L2 Process Outsourcing Reduces Production Labor Cost
Cost per 1000 Touche
s
World Class
Where are you?
25th 50th 75th 90th 99th
Other Benefits of L2 Outsourcing• Structure Establishes a Regulatory Fire Wall (P&C, Workers Comp, CGL, SUTA, Tax)
• Allows Custom Programs for L2 wage positions• Drives Productivity and Quality simultaneously• Provides State of the Art Process Technology• Fosters Entrepreneurialism• Creates clear control mechanisms• Lowers Cost of Sales• Drives Small Business Growth
Call to Action
• Meet with your Executive Team• Share what you have learned about L2• Help them complete their own case study• Help guide them to the their best solution• Go to PBJandACA.com for additional assistance
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Thank You
Rich BoehlingPresident CEO, Productiv Inc
PBJandACA.com
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