Under the Patient Protection and Affordable Care Act (PPACA),
health benefit exchanges will be operational on Jan. 1, 2014. PPACA requires
employers to provide a notice to all benefits eligible employees prior to the
beginning date of the exchange.
The notice informs employees about the existence of the
health benefits exchange and gives a description of the services provided by
the exchange. The notice also explains how the employee may be eligible for a
premium tax credit or a cost-sharing reduction if the employer's plan does not
meet certain requirements. The notice informs employees that if they purchase a
qualified health plan through the exchange, they may lose any employer
contribution toward the cost of employer-provided coverage, and that all or a
portion of the employer contribution to employer-provided coverage may be
excludable for federal income tax purposes. Lastly, the notice includes contact
information for customer service resources within the exchange, and an
explanation of appeal rights. The
notification requirement will take effect on October 1, 2013 and penalties
apply for noncompliance.
Employers
will need to provide new employees the notice within 14 days of their start
date. For current employees, employers
will need to provide the notice to their employees no later than October 1,
2013. For employees who may be electing
COBRA, employers must also provide the notice with their COBRA letter as well.
Earlier
this year, the Department of Labor provided employers with sample “Notices” to
use if their company offered health insurance or if they did not offer health
insurance. Employers will be able to use
this sample “Notice” until the Department of Labor creates a final version “Notice”
for all employers to use. Please click here
to view the sample “Notice”. Employers
can click here to review the guidelines regarding the
exchange notice. If your company does
not offer health insurance, please click here to view the “Notice” you have to provide to your
employee population.
The notice must be provided in writing to all benefits
eligible employees. Alternatively, it
may be provided electronically if the requirements of the DOL's electronic
disclosure safe harbor at 29 CFR 2520.104b-1(c) are met.
If
your company has any questions regarding these “Notices” or has general
questions regarding the new Health Care Reform laws, please feel free to contact
Ipswich Bay Advisors at our offices at 978.777.6554.
Thank
you.
