Every business owner must notify current employees of the existence of Health Insurance Marketplace by Oct. 1.
By Drew Gruenburg, SAF
Under the Affordable Care Act (ACA), every business owner is required to notify current employees of the existence of Health Insurance Marketplace (Exchange) for individuals and to provide information on how to access them by Oct. 1, 2013. Business owners are also required to notify all newly hired employees about their coverage options in the Exchanges beginning Oct. 1. Those who fail to properly notify employees may be subject to penalties for noncompliance under the Fair Labor Standards Act (FLSA).
SAF’s senior director of government relations, Corey Connors, said that notices must explain services provided by the Exchange, information on how an employee may contact the Exchange to request assistance, a basic explanation of employee eligibility for tax credits and notification that an employee purchase of coverage in the Exchange Marketplace may disqualify them from receiving an employer contribution to their health benefits.
“The notice must be understandable to the average employee,” Connors said, and the U.S. Department of Labor (DOL) provides guidance in that regard: separate model notices for employers that currently offer coverage and those that do not offer coverage that satisfy notification requirements under Section 18B of the FLSA:
DOL Model Notice – Employers that Currently Offer Coverage
English Version – Currently Offers Coverage
Spanish Version – Currently Offers Coverage
DOL Model Notice – Employers that Do Not Currently Offer Coverage
English Version – Do Not Currently Offer Coverage
Spanish Version – Do Not Currently Offer Coverage
Connors said employers will need to provide specific business information to their employees. This includes the business’s address and phone number, tax identification number and a point of contact at the business that is responsible for verifying health coverage options offered by the employer. The Exchanges use this information to verify employee eligibility for individual tax credits should they elect to purchase coverage in the individual Exchange, he said.
“On top of that, employers that currently provide coverage should prepare to provide information about the health plans they offer,” Connors added. “information such as which employees are currently eligible for coverage, whether dependents are eligible for coverage under the employer’s plan and whether the current plan meets the ACA’s minimum value standard.” The DOL Model Notice for Employers that Currently Offer Coverage also contains an optional questionnaire that provides additional information about employee eligibility for employer-sponsored coverage.
Connors said business owners can provide the Exchange notification in writing and send it via first-class mail to the employee or, for those with email access as part of their work, electronically. Alternatively, an employer may utilize a third party — multiemployer plans, issuers and third-party administrators — to provide notice to its employees, provided that they send it to all employees regardless of plan enrollment.
Connors emphasized that that the notification requirement is intended to inform employees of their coverage options in the public Exchange, which is only one option that employees have to satisfy individual mandate requirements under the ACA.