Among the many nuances (and nuisances) of the Affordable Care Act is the new obligation of employers to prepare and distribute a notice to employees advising of the health insurance exchanges that will become available to individuals starting on January 1, 2014. The Department of Labor (the "Department") has redefined the Insurance Exchanges as the "Marketplace," and the notice as the "Marketplace Notice."
This notice obligation is not a group health plan responsibility per se. All employers, including those that do not sponsor a group health plan, must provide a form of the notice to their employees. In addition, all employees must be provided the notice, including those who are not eligible for employer-sponsored group health plan coverage.
Key aspects of the Marketplace Notice rules are discussed below.
- When Must the Marketplace Notice Be Delivered?
- Current Employees: Current employees must receive the notice by October 1, 2013.
- New Employees: New employees hired on or after October 1, 2013, must be provided with a copy of the Marketplace Notice within 14 days of the date of hire.
- Who Must Receive the Marketplace Notice?
- Employees: All employees must receive the Marketplace Notice, regardless of whether they are eligible to participate in the health plan (for example, part-time employees) and regardless of whether they are enrolled in the plan.
- Dependents: Separate Marketplace Notices are not required to be sent to spouses or dependent children.
- Former Employees: Marketplace Notices are not required to be sent to former employees, regardless of whether they are still covered by or eligible for coverage under the plan (e.g., pursuant to COBRA or retiree coverage).
- How to Deliver the Marketplace Notice
- Mail: The Marketplace Notice may sent by first-class mail.
- Electronic Delivery: The Department's electronic delivery standards will apply to the Marketplace Notices. Therefore, the Marketplace Notices may be delivered by e-mail to those employees whose work-site access to e-mail is an integral part of the employee's job duties.
- New Hire Package (Probably): The Department guidance does not expressly state that the Marketplace Notice must be included in a new hire package. But presumably, that would be an acceptable method of delivery for new hires.
- Required Content of the Marketplace Notice
The Marketplace Notice can be relatively brief. By law, it need only disclose the following:
- The existence of the Marketplace;
- A description of services provided by the Marketplace;
- Contact information for the Marketplace;
- A statement that the employee may be eligible for a premium tax credit if the employee purchases a qualified health plan through the Marketplace; and l A statement that if the employee purchases health coverage through the Marketplace, the employee may lose the contributions made by the employer (if any) toward coverage offered through the employer's plan, and that all or a portion of the contributions may be excluded from the employee's income for Federal income tax purposes.
- Department of Labor Model Notice
The Department of Labor has issued a model (in the form of a partiallycompleted template) that may be used by employers to comply with their notice obligations. The Department actually issued two model notices: one for employers that do not offer any group health plan coverage, and a second for employers that do offer coverage to some or all of their employees. The link to the Department of Labor webpage that provides the notice for employers that offer group health plan coverage is as follows: http://www.dol.gov/ebsa/pdf/FLSAwithplans.pdf.
The guidance from the Department of Labor acknowledges that the model is just that - a model - and that employers may use a modified version, provided that it meets the content requirements mentioned above.
The model Marketplace Notice provides for the disclosure of information that goes well beyond that required under the statute. Moreover, it provides for information that may not be uniform to all of the employees covered under a typical plan.
In this regard, employers will wish to review the model notice carefully, and make a decision as to what information should, in fact, be included or omitted.