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Administrator Guide
Last Updated: 2023-06-23
Setup Considerations: Affordable Care Act Reporting

Setup Considerations: Affordable Care Act Reporting

You can use this topic to plan your configuration and use of reporting to meet the requirements of the Patient Protection and Affordable Care Act (ACA). It explains:
  • Why to set it up.
  • How it fits into the rest of Workday.
  • Downstream impacts and cross-product interactions.
  • Security requirements and business process configurations.
  • Questions and limitations to consider before implementation.

What It Is

The ACA regulates medical coverage for US employees. Workday enables you to report medical coverage to the Internal Revenue Service (IRS) to meet ACA reporting requirements.

Business Benefits

Workday helps you comply with ACA regulations by enabling you to prepare and transmit ACA forms to the IRS and to employees.

Use Cases

  • You’re an Applicable Large Employer (ALE) that needs to provide 1095-C forms each year to employees to summarize coverage.
  • You need to create 1095-C and 1094-C forms to transport to the IRS for Affordable Care Act reporting.
  • You have multiple ALE groups or a foreign ALE group.
  • You have multiple companies under a single entity.
  • You need to enable software partners to manage form transmissions.

Questions to Consider

Question
Considerations
How will you manage the printing and mailing of 1095-C forms?
You can configure an
ACA Mailing Connector
 integration that sends ACA 1094-C and 1095-C data to an external mailing service provider. The vendor, CIC Plus, provides the mailing service support at an additional cost.
You can access the
Create ACA 1095-C Forms
 task to generate PDFs and print them.
Will you use software partners to manage transmission of forms to federal and state governments?
You can enable software partners to do form transmission when you create or edit the company configuration.
What funding method do your benefit plans use?
The 1095-C data creation process uses the funding method (self-insured or fully funded) of benefit plans as of the day that you run the process.
You can edit the benefit plans to change the method before creating data when both:
  • The funding method of the plans changes.
  • You need to use the method as of the reporting year.
After you’ve completed reporting, you can edit the plan to restore the funding method. Example: In plan year 2021, you change to the
Self Insured
 funding method. However, when you transmit your 2020 1095-C reporting to the IRS, you need to change the funding method to
Fully Insured
 to match the method used that year. You restore the funding method to
Self Insured
 after you've completed the 2020-year reporting.

Recommendations

Consideration
Recommendation
Alternate Work Location
To ensure correct effective dating for residency requirements, use the
Change Contact Information
 task instead of the
Change Work Contact Information
 task.
Dependents of Deceased Employees for Self-Insured Medical Plans
You can hire surviving dependents as part-time employees if you’re a self-insured organization. This method ensures that the 1G code populates correctly. For a large number of dependents, you can use the
Import 1095-C Forms Recipients Data
 EIB.
EIB Configuration
To shorten address and name lengths, use the
Import 1095-C Form Recipients Data
 EIB.
Importing Recipients
Use the
Import 1095-C Forms Recipients Data
 EIB to load form data for covered participants whose enrollments you don't track in Workday. Example: COBRA recipients or retirees.
Legal Considerations
Consult with your legal team and benefit broker to determine:
  • Safe harbors for which you have eligible workers.
  • If you have populations to add or exclude from 1095-C data creation.
  • If you have multiple or foreign ALE groups or members that fall under the employer mandate.
  • If you have multiple companies that you need to report as a single entity.
  • Which configuration options to use for line 14, 15, and 16 codes in the
    Use coverage end date in month of termination
    check box, in the
    Create ACA 1094-C Company Configuration
     task.
Medical Plans
To ensure accurate codes for line 14, configure fields under the
US Affordable Care Act Options
 section and the
ACA Minimum Essential Coverage
 sections for medical plans.
Poverty Guidelines
Set up annual U.S. Federal poverty guidelines on the
Affordable Care Reporting Configuration
 task to ensure accurate codes and line 15 values.
Retirees
You can verify that retirees have membership in a retiree organization when you select the
Include Retirees
 check box on the
Create ACA 1094-C Company Configuration
 task.
Tuning Rules
You can create Benefit eligibility rules that include or exclude types of employees from 1095-C reporting, called ACA 1095-C tuning eligibility rules. Example: Exclude contractors from your reporting.
Waiting Periods
Configure waiting periods with enrollment event rules to ensure accurate 1095-C codes for the Limited Non-Assessment Period (LNAP).

Requirements

  • Select the
    Medical
     option for the
    Health Care Coverage Type
     to enable the ACA-related fields.
  • When using the
    Import 1095-C Form Recipients Data
     EIB, use the IRS country codes for international addresses. The IRS doesn't use ISO country codes.
  • Speak with your internal legal team or benefit broker about ACA requirements.

Limitations

Workday provides 1094-C data, but doesn’t generate 1094-C PDF forms. Workday does generate 1095-C PDF forms.
Workday automatically makes 1094-C authoritative or not-authoritative. You can’t configure this criterion. Workday suggests importing other 1095-C data using the
Import 1095-C Form Recipients Data
 EIB. You can send all of your 1095-C data collectively to the IRS under one authoritative transmission.
You might experience performance problems if you’ve configured more than 75 Payroll earnings on the
Affordable Care Reporting Configuration
 task.
Starting in Tax Year 2020, these fields require you to use the
Import 1095-C Form Recipients Data
 EIB to populate 1094-C and 1095-C forms:
  • Plan Start Month
    : A 2-digit number for the month. Required starting in TY 2020.
  • (Optional)
    Employee's Age on January 1
    : A whole number from 1 to 120.
  • Line 14
    : Individual coverage Healthcare Reimbursement Accounts (ICHRA) codes.
  • Line 17
    : A 5-digit zip code when Line 14 codes include codes for ICHRAs.

Tenant Setup

No impact.

Security

Domains
Considerations
Affordable Care Act (ACA) Administration - USA
 in the Benefits functional area.
Enables you to configure ACA:
  • ALE groups.
  • Company configuration.
  • Measurement periods.
  • Reporting.
  • Safe harbors.
Benefits administrators can manage ACA 1094-C correction overrides and ACA ALE member order, as well as view ACA reports.
Integration Build
 in the Integration functional area.
Enables you to create and configure integrations that send ACA 1094-C and 1095-C data to the IRS.
Manage: ACA Partner Integrations
 in the Benefits functional area.
Enables you to grant ACA data access to software partners for form transmission.
Process: ACA Tax Filing 1094-C/1095-C - USA
 in the Benefits functional area.
Enables you to run the annual tax filing process and can create 1095-C data and forms.

Business Processes

No impact.

Reporting

Reports
Considerations
View 1094-C Form Data
Enables you to verify:
  • The total number of 1095-C forms for the ALE.
  • Whether someone has corrected the 1094-C data after transmitting it to the IRS.
View 1094-C FTE and Total Count Details
Enables you to review all employees included in the total and full-time employee counts.
View 1095-C Form Recipient Data
Enables you to view corrections and external recipients loaded by the
Import 1095-C Forms Recipient Data
 EIB.
View Current 1095-C Form Recipient Data
Enables you to view the same data as the
View 1095-C Forms Recipient Data
 report, but displays only the most recent 1095-C form.
1095-C Eligible Employees by State or Region
Enables you to view 1095-C form data for selected workers by state or region. This report doesn't display workers that you add with EIB.

Integrations

Use these ACA connectors for the IRS Form 1094-C and 1095-C data:
  • ACA Information Returns (AIR) Connector
     :
    • Sends ACA registration information to the IRS.
    • Submits ACA tax data under the Affordable Care Act Information Returns (AIR) Program.
    • Retrieves status update messages from the IRS endpoint.
  • ACA Mailing Connector
     communicates with CIC Plus, Workday's external mailing service vendor. Set up a business relationship with CIC Plus approximately 2 months before the transmission deadline.
Use these web services to work with software partners that manage form transmission:
  • Get ACA Employer Data
     : Retrieves company or employer ACA data for 1094-C state and federal filings.
  • Get ACA Employee Data
    : Retrieves employee ACA data for 1095-C forms.
    Workday doesn't mask employee Social Security Numbers (SSN) for the web service.
  • Put Federal ACA Transmission Status
    : Generates federal transmission status and details to display in the
    ACA Transmission Status
     report.
  • Put State ACA Transmission Status
    : Generates state transmission status and details to display in the
    ACA Transmission Status
     report.

Connections and Touchpoints

Workday offers a Touchpoints Kit with resources to help you understand configuration relationships in your tenant. Learn more about the Workday Touchpoints Kit on Workday Community.