Employers covered by the Fair Labor Standards Act (FLSA) must provide current employees with written notice of their coverage options through the health insurance marketplaces on or before October 1, 2013 (commonly referred to as the “Exchange Notice”). This requirement applies to all employers, regardless of size or whether they offer group health coverage. The notice is intended to educate employees about the availability of coverage through the marketplaces, premium subsidies that may be available if their employer’s plan is unaffordable or does not provide minimum value, and the consequences for declining employer-sponsored coverage (e.g., employee will lose employer contribution toward health insurance and will not be able to pay for insurance using pre-tax dollars). The notice must be provided to all current employees (part-time, full-time, seasonal, etc.), whether they are eligible for or enrolled in employer-sponsored coverage. New employees must be provided with the notice within 14 days of being hired.
The U.S. Department of Labor (DOL) published two model notices for employers: one for those who do not offer group health coverage and one for employers who offer some or all employees group health benefits. The model notices are available in pdf and Word format and in Spanish by clicking here. Colorado’s marketplace, Connect for Health Colorado, has also produced model notices containing specific contact information for Connect for Health Colorado. These notices are available by clicking here.
Although the DOL recently announced there will be no penalty for failing to provide the notice, employers are encourage to comply with this requirement. The notice provides employees with information about the employer’s plan, if any, which is necessary when an employee applies for coverage through the marketplace. Accordingly, many employees will be requesting this information from their employers. Providing information about the availability of employer-sponsored coverage also may prevent employees from obtaining inappropriate premium subsidies.
A more thorough description of this notice requirement, what information must be included in the notice, and how and when it must be delivered is available in MSEC’s Health Care Reform Learning Zone.