The Department of Labor (DOL) has confirmed what many have suspected– there is no fine for failing to provide the Notice of Exchange. On September 12, 2013, the DOL released a very short FAQ answering the question: “Can an employer be fined for failing to provide employees with notice about the Affordable Care Act’s new Health Insurance Marketplace?” The answer, unambiguously, is “No.”
If your company is covered by the Fair Labor Standards Act (FLSA), the ACA and implementing regulations require you to provide a written notice to all employees about the Health Insurance Marketplace by October 1, 2013. However, neither the ACA nor the regulations provide for any penalties if an employer fails to meet this requirement (not yet anyway).
Nevertheless, providing information about the Marketplace to employees may be in the employer’s best interest. First, accurate and effective communication about an employer’s benefits are good for employee relations. Second, useful and digestible information about the employer’s plan and how it may impact an employee’s eligibility for tax credits or cost sharing subsidies in the Marketplace can get ahead of any questions that might start flooding into to HR as Marketplace advertisements heat up.
Employers seeking to satisfy the Notice requirement should prepare written materials that inform employees:
- About the Health Insurance Marketplace;
- That, depending on their income and what coverage may be offered by the employer, they may be able to get lower cost private insurance in the Marketplace; and
- That if they buy insurance through the Marketplace, they may lose the employer contribution (if any) to their health benefits
The DOL has two model notices to help employers comply. One is for employers who do not offer a health plan and another is for employers who offer a health plan to some or all employees:
- Model Notice for employers who offer a health plan to some or all employees
- Model Notice for employers who do not offer a health plan
The model notices are also available in Spanish and MS Word format at the DOL’s Affordable Care Act webpage. Employers can use one of these models or a modified version.
