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Employee Exchange Notice Requirement Nearing October 1 Deadline

09/18/13

  04:10:01 pm, by MedBen5   , 511 words,  
Categories: News, Health Plan Management, Health Care Reform

Employee Exchange Notice Requirement Nearing October 1 Deadline

Capitol Building

No later than October 1, 2013, all employers are required to provide a Notice to their employees providing information about the new health care Exchanges created by the Affordable Care Act (ACA). The Exchanges, now called Health Insurance Marketplaces, provide individuals and small employers access to certain insurance carrier’s health insurance policies. The Notice provides some basic information about those policy options and how to contact the Health Insurance Marketplace.

In order to comply with the ACA requirement, all employers, regardless of size, need to send the Notice to ALL of their employees – including those employees who are not on their health plan and those who do not work full-time. While the Department of Labor (DOL) recently clarified that there is no penalty for failing to send the Exchange Notice (DOL FAQ on Notice of Coverage Options released September 11, 2013), it did not waive the requirement that employers distribute the Notice to employees. The DOL FAQ on Notice of Coverage Options can be found at the DOL website.

In order to assist employers with this task, the DOL released two Model Notices earlier this year – one for employers that offer coverage to their employees, and one for employers that don’t offer coverage. If an employer offers coverage to some employees and not to others, the employer can either provide both notices to the respective employees, or they can provide the “offering” coverage notice and specifically indicate on page 2 who is eligible for coverage and who is not. You should also note the following:

  • For the Model Notice – Employer Offering Coverage, only Part A (page 1) is required; Part B (pages 2 and is optional.
  • For the Model Notice – Employer Not Offering Coverage, Parts A and B (pages 1 and 2) are both required.

One of the problems with the DOL’s Employer Offering Coverage Model Notice is that it requests (as part of its optional language) that the employer declare whether or not its current plan is affordable and provides minimum value. Since both of these requirements do not take effect for employer-sponsored plans until 2014, many employers are struggling with how – and if – to complete this portion of that Model Notice. As an alternative, an employer can create its own Notice, provided it contains all of the information required by law and the technical guidance released on May 8, 2013 (also found at the DOL website). Neither the law nor the Technical Guidance require that an employer declare the affordability or minimum value status of its current plan.

To that end, MedBen has created a sample Exchange Notice which meets the legal and technical Exchange Notice requirements, and is available to clients by contacting Sales Analyst Sally Wood at swood@medben.com. As long as all of the information in this Sample Notice is included, you can customize it to meet your needs.

Remember, ALL EMPLOYEES should receive the Exchange Notice no later than October 1, 2013. In addition, on or after October 1, 2013, any new hires must receive the notice within 14 days of their date of hire. Notices can either be sent to employees by first class mail or hand-delivered.

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