Affordable Care Act: Notify Your Employees

The employer mandate requiring certain large employers to offer health insurance to their employees has been extended to January 2015.  However, many other provisions of the Affordable Care Act such the requirement for employers to notify employees of their health insurance options are still set to go into effect sooner.

Who does this affect?
The notification requirement will affect many more employers than the employer mandate.  All employers regulated under the Fair Labor Standards Act (FLSA) fall under the notice requirements.  In general, the FLSA applies to employers that have at least one employee and annual revenues of at least $500,000.  Employers subject to the requirements must notify all employees, regardless of part-time or full-time status.

What do we need to communicate?
The notice must contain information regarding the existence and function of the new health insurance Marketplace.  The notice must also explain how the employee could be affected by the premium tax credit and opting out of employer health insurance. The US Department of Labor(DOL) has model notices on their website for employers who offer a health plan and employers who do not offer a health plan at http://www.dol.gov/ebsa/healthreform/index.html.

When are we required to notify employees?
Current employees must be notified by October 1, 2013.  Employees hired after October 1, 2013 should be notified at the time of hiring.  The DOL considers notifications made within 14 days of the employee’s start date to be timely.

How must the notice be delivered?
The notice must be provided in writing.  It may be provided by first-class mail or electronically provided that the notification meets certain requirements.

For more information, you can read the Technical Release on the US DOL website at http://www.dol.gov/ebsa/newsroom/tr13-02.html.

The Affordable Care Act continues to evolve and we’ll continue to provide information that affects you.  Please contact Anders with any questions.