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Affordable Care Act Confusion Makes Visibility a Door Opener for ADP

Among those companies now dining on the complexity and confusion that the nation’s Affordable Care Act (ACA) has served up, few are better known to small and midsize businesses leaders than Automatic Data Processing, Inc. (ADP) — the 60-year-old payroll outsourcing giant that has over the years evolved into a provider of human capital and benefits administration solutions.

Middle-Market Executive recently caught up with Dave Imbrogno, who oversees services and operations for ADP’s ACA solution — ADP TotalSource — and asked him how middle-market customers were responding to the firm’s 10-month-old ACA offering.

Dave_Imbrogno_MME: Are customers ready to buy such a solution? Or are they still waiting for the political fog to lift?

Imbrogno: Well, we begin by just supplying them with a compliance checklist, which allows them to walk through some questions and helps them to better understand what it means for them as an employer. It helps them to begin thinking about the types of employees that they have and the type of industry they are in, so that they understand their workforce demographic better and what is required as far as the necessary preparation goes. When they dig into this, it really points to the question: How do I view benefits in my business today? From there, the next question is frequently: How important is talent to my business? And: How do I optimize my labor spend to engage my workforce in a world where everyone is trying to do more with less? How do I do this in a compliant way?

MME: Can you share some of your checklist questions with us?

Imbrogno: It’s questions such as, Do you have a seasonal workforce? What is the number of part-time vs. full-time employees in your workforce? We ask about the types of plans a business currently offers. We try to get to the root of what value their workforce has to the business.

MME: Who can answer these questions when it comes to the operations of middle-market firms?

Imbrogno: What you often find is that there is an outsourced payroll provider that likely provides some of tax services as well. They will have a broker that is handling some or all of their healthcare. There may be several different ones for benefits, health, dental, and vision. There may be another for a retirement plan. And then what you find from a compliance standpoint is that there is someone internally who is managing these relationships and dealing with the carriers as well. A firm will often have three or four different relationships, and maybe they’ll have an accountant involved or a lawyer. Each firm arrives at the same question: How do we manage this?

MME: What kind of visibility does TotalSource offer business leaders?

Imbrogno: Well, it offers really a dashboard view of your workforce and of the eligibility of that workforce. For instance, how many employees are reaching full-time equivalency is guidance that is provided. For example, there is hourly and weekly and monthly guidance in terms of hours worked that can help to determine who is eligible for benefits.

MME: When you engage business leaders, is the discussion becoming more of a talent and strategy discussion, rather than a cost management one?

Imbrogno: It’s a pretty holistic conversation. They are often interested in benchmarking against their industry or within a given geographic footprint. Sort of, Here’s where you rate from a benefit and compensation standpoint. We actually have just rolled out a new human capital dashboard that provides some of the analytics around turnover by employee segment so that they can start combining some of the insights into benefits and compensation. This often leads to the discovery that it may not be a coincidence that they have a turnover issue in a certain segment.

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