ComplyRightComplyRightComplyRightComplyRight
  • WEBINARS
    • Upcoming
    • On Demand
  • TOPICS
    • I want to learn about:
      • Hiring an Employee
      • Creating Policies
      • Paying Employees
      • Discrimination & Harassment
    • Column 2
      • Employment Law
      • Labor Law Postings
      • Employee Leave
      • Employee Recordkeeping
    • Category 3
      • Independent Contractors
      • Tax Reporting
      • Improving Employee Performance
      • Firing an Employee
    • Seven Reasons Why Employee Performance Reviews Still Matter in a Remote Work World

      Employee Performance Reviews
      Read More
  • SOLUTIONS
    • Employee Management
      • Hiring
      • Time and Attendance
      • Training and Safety
      • Recordkeeping
      • Employee Policies
    • Labor Law Posters
      • Poster Guard® Service
      • ComplyRight Posters
      • Electronic Posters
      • Employee Handouts
      • Partner Solutions
    • Tax Information Reporting
      • DIY Filing Solutions
      • Processing Services
      • Partner Solutions
    • NEW! Secure Document Print and Mail Services
    • Featured Solution

      Poster Guard Compliance Protection
      Learn More
  • ABOUT
    • Who is ComplyRight
      • Mission
      • Core Values
      • Leaders
      • Contact
    • Careers
      • Culture
      • Benefits and Perks
    • Brands
      • HRdirect
      • HRdirect Smart Apps
      • Poster Guard
      • eFile4Biz
    • Join Our Team

      Join Our Team
      Learn More
  • SUBSCRIBE

ACA Information Reporting May Create HIPAA Privacy and Security Concerns for Employers

Published on September 20, 2015
  • Tax Reporting
  • ACA

The Affordable Care Act (ACA) added various reporting requirements for health plans and employers, including employer information reporting requirements under Section 6055 and 6056. Information gathering will be critical to successful reporting but collecting more sensitive information about employees may raise additional data privacy and security risks.

Under the ACA, providers of “minimum essential coverage” (MEC) must report certain information about that coverage to the Internal Revenue Service (IRS), and to persons receiving that MEC. Providers of minimum essential coverage will use Forms 1094-B, 1095-B, 1094-C and 1095-C to report this information.

Depending on the type of provider, they will need to report on detailed employee data, including names, Social Security Numbers of each employee and covered dependents and months during which health coverage was offered and provided in 2015.

Information gathering will be critical to successful reporting but collecting more sensitive information about employees may raise additional data privacy and security risks.

Collecting this information will be an increased burden, creating more risks on employers given the increased amount of sensitive data that they will be handling, and possibly from vendors working on their behalf. Some steps employers can take to mitigate these risks include:

  • Determine whether the information is subject to HIPAA. Employers will need to consider whether this information, collected for ACA reporting requirements, is protected health information (PHI) under HIPAA or whether it falls under any HIPAA exception. As of the date of this article, the IRS has not issued any guidance on whether HIPAA applies to employer information reporting requirements.
  • Implement appropriate safeguards. For an employer that determines the information collected for this purpose is PHI, it will need to ensure the appropriate steps are taken under the HIPAA privacy and security rules. For example, employers will need to implement appropriate administrative, technical and physical safeguards to protect the privacy of PHI, train all employees on policies and procedures regarding PHI, designate a privacy officer to develop and implement privacy policies and procedures and report any unauthorized use or disclosure of PHI.
  • Confirm your vendors will protect this information. The IRS reporting regulations permit the use of third party vendors to assist employers in the reporting process. Whether the vendor is a “business associate” under HIPAA, employers should be sure the vendor is HIPAA Certified and contractually bound to maintain and implement appropriate privacy and security practices, including data breach preparedness.

Employers navigating through the ACA reporting requirements have many issues to consider and how personal information or protected health information is safeguarded in the course of those efforts is one more important consideration. Employers need to prepare now for this upcoming obligation by putting procedures in place. Especially since penalty amounts were recently increased for employers subject to the ACA’s information reporting requirements.

Employers that fail to comply with the requirements may be fined for failing to file correct information returns and for failing to provide correct information returns to employees. The penalty for failing to file an information return increased from $100 to $250 for each return, with a cap of $3 million. The penalty for failing to provide correct employee information to employees also increased from $100 to $250 for each return.

ComplyRight Distribution Services (CDS) offers a secure print-and-mail solution for businesses looking to outsource this function. The CDS facility is HIPAA Certified and has achieved SOC certification from the American Institute of CPAs. So employers can rest assured that all information will remain protected throughout the process, and they will not be exposed to a potential data breach.

efile4Biz | Tax reporting, Independent Contractor

efile4Biz.com - The smart way to file & deliver

Related Content

  • play-button
    2021 Tax Refresher: Review Changes Affecting 1099, W-2 and ACA Reporting
    December 2021

    Let us help you prepare for the upcoming season with this refresher course covering recent developments impacting informational returns. This … Read more

    Tax Reporting

  • 1099s, W-2s and ACA Forms - Tax Seasonplay-button
    1099s, W-2s and ACA Forms: New Tax Season, New Priorities for Fast, Fully Compliant Filing
    November 2019

    Tax season is coming up fast, and soon you’ll be filing mandatory employee and contractor forms. Now is the time … Read more

    Tax Reporting

    ACA

    Worker Classification

  • Taxpayer First Act: More Business Required to E-File Informational Returns
    Taxpayer First Act: More Businesses Required to E-File Informational Returns
    July 25, 2019

    On July 1, 2019, President Trump signed the Taxpayer First Act. This act proposes wide-sweeping changes in an effort to … Read more

    Tax Reporting

    ACA

  • ACA Here to Stay? IRS Targets Employers Who Failed to File ACA Forms
    ACA Here to Stay? IRS Targets Employers Who Failed to File ACA Forms
    January 18, 2019

    If you’re confused about the status of the Affordable Care Act (ACA), you’re not alone. While the ACA continues to … Read more

    Tax Reporting

    ACA

  • 2018 ACA Reporting Is Required and Strictly Enforced by IRS
    November 14, 2018

    As the year closes and the tax-filing season looms, employers may question the status of Affordable Care Act (ACA) reporting. Is … Read more

    Tax Reporting

    ACA

  • Attention, Employers: New Tax Bill Doesn’t Change Your 2017 ACA Reporting Requirements
    January 2, 2018

    Upon signing the tax overhaul bill in late December, President Trump declared that the ACA was “essentially” repealed, thanks to … Read more

    Tax Reporting

    ACA

  • Alert: IRS Announces 30-Day Extension of ACA Reporting Deadline
    December 27, 2017

    Businesses preparing for this year’s Affordable Care Act (ACA) reporting requirements just received an end-of-the-year gift from the IRS. On … Read more

    Tax Reporting

    ACA

  • ACA Employer Update: What You Need to Know Nowplay-button
    ACA Employer Update: What You Need to Know Now
    December 2017

    Given the ongoing debate about the future of the Affordable Care Act (ACA), many employers are asking themselves, “Is the … Read more

    Tax Reporting

    ACA

Upcoming Webinar

Webinar Name

Date & Time

Presented by:

Learn More
Shop Our Brands 
HRdirect
HRdirect Smart Apps
Poster Guard
Formstax eFile4Biz

At ComplyRight, our mission is to free employers from the burden of tracking and complying with the complex web of federal, state and local employment laws, so they can stay focused on managing and growing their businesses.

©2021 ComplyRight, Inc.

Webinars

  • Upcoming
  • On Demand

Solutions

  • Employee Management
  • Labor Law Posters
  • Tax Information Reporting

About

  • Who is ComplyRight
  • Careers
  • Brands

Legal

  • Privacy Policy
  • Terms of Use

Popular Topics

Performance Policies Discrimination and Harassment Employment Law HiringLabor Law PostingsIndependent Contractors

Subscribe to Our Newsletter

Subscribe

Follow Us

  • RESOURCES
    • Knowledge Center
      • Tip Sheets
      • E-Guides
      • Podcasts
      • Infographics
      • Videos
    • Webinars
      • Upcoming
      • On Demand Webinars
    • Research and Trends
      • Compliance Survey
      • Trend Surveys
      • Minimum Wage Monitor
    • HR 101 Courses
  • TOPICS
    • Hiring an Employee
    • Creating Policies
    • Paying Employees
    • Discrimination & Harassment
    • Employment Law
    • Labor Law Postings
    • Employee Leave
    • Employee Recordkeeping
    • Independent Contractors
    • Tax Reporting
    • Improving Employee Performance
    • Firing an Employee
  • SOLUTIONS
    • Employee Management
      • Hiring
      • Time and Attendance
      • Training and Safety
      • Recordkeeping
      • Employee Policies
    • Labor Law Posters
      • ComplyRight Posters
      • Poster Guard®
      • Partner Solutions
    • Tax Information Reporting
      • DIY Filling Solutions
      • Processing Services
      • Partner Solutions
  • ABOUT
    • Who is ComplyRight
    • Newsroom
    • Careers
    • Brands
    • Contact Us
  • SUBSCRIBE
ComplyRight