ACA Compliance Starts with Methodical Risk Assessment

ACA Compliance Starts with Methodical Risk Assessment



The best way to ensure Affordable Care Act compliance is to begin with a comprehensive risk assessment

The Washington D.C. policy experts perceive the Patient Protection and Affordable Care Act (ACA) as too complicated to understand. For ACA, compliance won’t be easy and auditing the readiness for compliance is not easy either. However, the auditors are optimistic that once you get an idea of the organization’s risk profile about the act, it is simpler to focus on other risks that pose a bigger threat.

According to Annette Schandl, who is the senior vice president of audit at CHAN Healthcare, management has to put in place specialists to implement the ACA. Once the implementation is completed, then the process is audited. According to her, internal audit must be brought into place as the policies and procedures are developed to ensure the right controls are developed too.


The Biggest Challenge

The Biggest Challenge

Many stakeholders are having problems and organizations are confused because the process appears to be too complicated. For instance, the human resource professionals are having their fair share of the problems because more than half of the human resources and payroll consultant are unprepared to comply with ACA’s regulatory requirement requirements. One of the compliance problems is related to penalties, exchange notices, and the reporting required to the U.S. Internal Revenue Service. Internal audit need to help in identify and order the risks and assessment of the compliance.

In the midst of these confusions, many large companies are using various benefits strategies that end up costing more to employees in the wake of exercise tax on high-value health plans which are projected to be effective by 2018. Other companies have opted to limit the hours of some employees to avoid the coverage mandate.

Other issues that need to be addressed include how to communicate to employees, special transition rules, auditing of certain health plans by the U.S. Department of Labor, addiction of equity Act and Mental Health Parity. Even if these are areas new to the internal auditors, what need to be performed by the auditors in response is not new. The bottom line is that compliance with ACA would be difficult, but auditors should first perform tasks they are familiar with without being daunted by what they are unfamiliar with.


Risk Assessments

Begin with Risk Assessments

This was the trickiest part of compliance for Belluvue, Wash-based Nordstorm. According to Dominique Vincenti, vice president, internal audit and financial controls say that the problems were self-inflicted since the company maintains benefits, HR, and Tax department. Part of the problem was because the HR department managed some of the taxes for the enterprise instead of the tax department.

In this kind of circumstance, each department thinks the other is taking care of it. A detailed risk assessment conducted by her to the ACA suggested that roles and responsibilities were not clearly stated in terms of tax implications of the ACA. Because of the detailed risk assessment, the team was able to agree on the roles, and now the problems facing the ACA are mostly complete.

The Value of Comprehensive Risk Assessment

This was seconded by Sharon Gipson, the vice president and corporate audit at blue Cross Blue Shield of Michigan. She says that a smart approach to ACA begins with comprehensive risk assessment. Decisions have to be made about the pieces of ACA applicable to an organization to ensure plans are made on what to focus.

She recommends that organizations should primarily involve not only the internal processes but also the vendors and partners to ensure a much compliance risk assessment into the organization. The strategy is to address the higher risk areas first through the understanding of the portions of the ACA and how they have been implemented within the organization.


Business as usual

Business as usual

The role of the internal auditor is to ensure employer readiness and compliance according to Gwendolyn Skillern, the general auditor and senior vice president of CareFirstBlueShield in Owings Mills, Md. She says that auditors should start with what they know first. For instance, her company began by dividing the compliance departments into five tracks. The internal auditor was embedded into one of them to ensure the compliance strategies were understood well and efficiently direct the audit activity. She says that the auditors cannot work in a vacuum but need to work hand in hand with the business to mitigate the risk facing the company.

Meeting Requirements

Several challenges are experienced when internal auditors try to look at the control processes and procedures that are implemented on the full-time employees and attempting to track the record keeping requirements of the ACA. According to ACA, a full-time employee works 30 or more hours per week. The internal audit department has to make it follows the ACA requirements.

A Smart Approach

The best approach to prepare for the ACA is to make sure the auditing of the compliance is a routine process. For instance, it is important to perform a risk assessment and build an audit calendar to help the business comply with ACA regulations.


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Bill Clinton Shares on His Support of Global Entrepreneurship

Bill Clinton Shares on His Support of Global Entrepreneurship


Bill Clinton


Since leaving office as President of the U.S, Bill Clinton has steadfastly shown his support for entrepreneurship, unlike his predecessors and successors. He has achieved this through the Clinton Foundation as well as the Clinton Global Initiative. Both of these have created programs to provide funding and mentoring to hundreds of entrepreneurs globally. In an interview, Mr. Clinton goes ahead to share his vision and priorities for business leaders in the 21st Century.

The Clinton Global Initiative Mission on Entrepreneurship

When asked how support for entrepreneurship fits into the broader CGI mission, Mr. Clinton went ahead to state the status quo. When starting the initiative, Mr. Clinton, and his team noted that people go to many meetings, discuss problems and their solutions, but fail to implement the solutions. For CGI, for one to come back the following year, one had to commit to doing something. For the first few years, a vast majority of the commitments were made by foundations, NGOs, and stand-alones. However, as of 2008, and since then, 90% of the commitments were being made by partnerships. The success rate also went up from 86% (for stand-alones) to 101% (for partnerships), exceeding their goals as a result of working together.


Clinton Global Initiative Mission


When talking about entrepreneurship in the context of CGI, Mr. Clinton stated that diverse partnerships come up with better decisions when dealing with new problems and challenges. These collaborations have proven successful and has become a routine for CGI.

At CGI, they realized that partnerships have more success, thus they do their best to promote collaboration. After collaboration, they go ahead to ensure that one has access to technology and finance.

CGI’s Partnership with Kiva

On this, Mr. Clinton went ahead to give examples of the success of Kiva. Kiva works by providing people who are socially conscious an opportunity to invest in a business in a developing country, as little as $25. When CGI made the commitment to partner with Kiva, they had put out loans worth $1.7 million in America, and are currently at $10 million in business loans to small American businesses.


CGI Partnership with Kiva


His interest in Kiva was sparked after Bill’s encounter with Muhammad Yunus in the early ’80s. Mr. Yunus inspired the first urban microcredit bank in America, South Shore Bank, later called ShoreBank. The bank made gave loans to Croatian electricians and African American carpenters, experiencing runaway success.

About Kiva City Initiatives

Kiva moved into 11 cities, getting them to $10 million in loans. They helped Kent Walker, who hails from Little Rock, to become the largest cheesemaker in his state. Mr. Walker started making cheese in his church in a vat. When he got his loan from Kiva, he expanded his business, Kent Walker Artisan Cheese, to enjoy great success.

Kiva also helped a woman in Washington D.C. who saw the need for providing charging stations for all-electric cars. She did this by renting parking spaces on parking lots at retail or commercial office buildings. After renting the space, she would put up a little sign. Kiva provided her with a $5,000 loan, enabling her offer reasonably-priced recharge services for electric cars at various spots all over the D.C. area.

Opening of GPS Technology and Broadband to Civilian Use

Clinton pointed out the dominance of South Korea’s broadband in the world. He went on to point out the net neutrality debate and how to handle it. The debate arose from the way the infrastructure is financed. In South Korea, the infrastructure is developed by the government, as opposed to private companies, and opened to the public market.


GPS Technology and Broadband


This is what Mr. Clinton did with GPS. He terms it as a fabulous idea, which provided entrepreneurs with low barriers to entry, enabling them do unbelievable things. He goes ahead to voice his support for net neutrality and its importance for entrepreneurial access. Small businesses are to benefit more than big businesses from having a rapid global broadband.

Entrepreneurial Activity in the ’90s and Now

With a decrease in firm formation and entrepreneurial activity, Mr. Clinton thinks that Small Business Administration should be more aggressive. He also believes that there should be a critical look at the impact caused by Dodd-Frank on legitimate community banks.

Politics vs. Entrepreneurship


Politics vs Entrepreneurship


When asked about why politicians fail to fulfill their promises and pledges on small businesses, Mr. Clinton clearly stated that it was fear. These politicians fear that after a crash, anything bad that happens will be held against them. He gives an example of all the trouble that followed him after signing the bill that brought an end to Glass-Steagall. A study done later on proved that unified banks are less likely to fail compared to commercial or investment banks.

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