Employer-Provided Exchange Notice Requirement
The Patient Protection and Affordable Care Act (ACA) amended the Fair Labor Standards Act to require employers to provide a written notice to current employees by March 1, 2013 (or at the time of hire for new employees) with information about the Exchanges. Specifically, the notice must include the following:
- A statement about the existence of the Exchanges, a description of the services provided by the Exchanges, and contact information for the Exchanges
- An explanation of the circumstances under which an employee may be eligible for a premium tax credit through the Exchanges
- An explanation that, if the employee purchases a qualified health plan through an Exchange, the employee may lose a tax-free employer contribution to an employer-provided health plan
When and How Must Employers Comply With the Exchange Notice Requirement?
Citing a number of factors, the DOL delayed the March 1, 2013 deadline for providing the notice until regulations implementing the notice requirement are issued later in 2013. The DOL expects that the new deadline will be in the late summer or fall of 2013, which will coordinate with the open enrollment period for the Exchanges.
The DOL may provide a model notice, or may allow employers to meet the notice requirement through use of an employer coverage template discussed in recently proposed regulations addressing eligibility and enrollment in the Exchanges. The template will be available for download on the Exchange Web sites and will include information about the employer’s health coverage that will be used in determining an employee’s eligibility for premium tax credits through the Exchanges.
Employers should stay tuned for future guidance from the DOL announcing the deadline and providing additional clarification on complying with the notice requirement.