Affordable Care Act
Business

Survey: Nonprofits Largely Unready for New Healthcare Requirements

New requirements established by the Affordable Care Act are causing confusion among unprepared nonprofits.

The 2015 Nonprofit Employee Benefits Survey, recently released by benefits management and research firm PPI Benefit Solutions, has found that very few nonprofits understand the new demands the Affordable Care Act (ACA) has put upon employers. These results come at a critical time for employers, since on January 1, 2015, all businesses with at least 100 full-time equivalent employees were required to start providing health coverage. (There are also requirements for organizations with fewer than 100 employees.)

“Survey results indicate that in 2015, fewer nonprofits understand Affordable Care Act (ACA) requirements, and nearly half consider ACA compliance to be ‘very challenging,’” PPI said in a news release. “Furthermore, a majority of surveyed nonprofits have not calculated the cost of compliance.”

That cost, should nonprofits not get up to speed, could translate into significant penalties when new regulations kick in.

Confidence Crisis

Many nonprofits were confident in their understanding of ACA compliance in 2014, but this year that number has fallen significantly.

Ninety-two percent of those surveyed in 2014 claimed they had “a moderate understanding” of the ACA, according to PPI. Out of that majority, 18 percent said they were “extremely knowledgeable.”

But this year just 47 percent say they have a “moderate understanding” of compliance rules, and only 5 percent consider themselves “extremely knowledgeable.”

A Path Forward

Because many nonprofits consider complying with the ACA to be “very challenging,” they are increasingly seeking individual expertise or help from outside of their organization.

“Smaller, mid-sized employers are relying heavily on their brokers and administrators to bring clarity around certain aspects of the law, what does or does not apply, and what tools are available to help them meet their requirements,” Karen Greco, director of marketing at PPI, said in the news release.

Another change resulting from the legislation’s implementation: More nonprofits are shifting costs to employees. This is happening via health savings accounts (HSAs), which feature lower premiums but high deductibles. The number of surveyed organizations offering HSAs increased to 56 percent in 2015 (compared with just 12 percent last year).

And though nonprofits may be unprepared or confused about complicated new requirements, close to 100 percent of those surveyed will still commit to providing healthcare for employees.

And for those committed organizations, PPI has some advice in its report:

“Gain a better understanding of the Affordable Care Act (ACA) and develop a plan to comply with 2015/2016 requirements. Look to your benefits administrator or broker for ACA information and service solutions. Leverage data collection and reporting from Benefits, Payroll, and HRIS systems.”

(Steve Hamblin/Fuse)

Morgan Little

By Morgan Little

Morgan Little is a contributor to Associations Now. MORE

Got an article tip for us? Contact us and let us know!


Comments