As there seems to be some confusion regarding which employers are obligated to provide "Exchange Act Notices" by October 1, 2013 and to whom, here is a quick reminder:
Who Must Provide the Notice? All employers (subject to the FLSA) must provide each of their current employees with notice of the Affordable Care Act health care exchange (the "Marketplace Exchange") coverage options.
When Does the Employer Have to Provide the Notice? All employers must provide a notice (either a notice of employer coverage or a notice of no employer coverage) by October 1, 2013. For new employees hired after October 1, 2013, the notice must be provided within 14 days of hire date.
Who Gets the Notice from the Employer? A notice must be issued to all current employees regardless of full-time, part-time, or seasonal status. Employers who offer health plans can use one of the model notices and employers who do not offer health coverage will use the other. The notice should include a description of the Marketplace Exchange services and contact information for assistance with the Marketplace Exchange. Model notices have been issued by the DOL, see with plans and without plans.
Note: There is no specific fine or penalty for failing to provide the notice, however the notice may be viewed as a required disclosure about the plan, and the failure to provide the notice could trigger an audit or other enforcement activity.
What About COBRA Notices? Also, beginning October 1, 2013, COBRA qualifying beneficiaries must be informed of their option to purchase coverage through the Marketplace Exchange or to choose COBRA to continue their coverage. A new model COBRA election form that incorporates these notice provisions is available on the DOL website.
Employers should amend their COBRA election form to include notice of these options by October 1, 2013. For employers using third party COBRA administrators, please check with your service provider to confirm that the new form of notice will be used starting October 1, 2013.