Exchange Notices

In less than a month, the employer exchange notification is due to be delivered to every employee—either via the old-fashioned snail mail or email. And every employee means every employee—not just those eligible for benefits, but every employee on your payroll: active, leave, temporary and let’s not forget those who are not on your payroll but once were. (Yes, your COBRA participants are eligible and will require a notification, but this may be released during your annual enrollment period.)

By October 1, employers are required to ensure every employee receives this notice of the existence of the Exchange/Marketplace option. After January 1, 2014, every new employee must receive this notification within 14 days of hire to remain compliant. HHS released a model notice earlier this year that every employer can use, and edit if necessary, to meet corporate needs (as long as the standard required information remains in the body of the notice). Two notices exist: one for employers offering coverage and one for those not offering coverage. The notice includes information on whether the employer is offering coverage—to whom and if that coverage is affordable. It directs employees to healthcare.gov for more information on assessing the options available in the employee’s state. One section is identical to the Marketplace Employer Coverage Tool on the Exchange application. What is not included in this notice? Specific information for each employee that will assist him or her in filing an application with the Marketplace in the resident state if so desired.

Is the assumption that the employer will send this blank form notification out en masse and wait for the employee to come back to the HR department and ask, “Would you please fill out the employer section as I would like to apply for coverage in the Marketplace?” Based on what is included and excluded, that seems like the plan. To complicate matters, the employer must fill out the Marketplace Employer Coverage Tool, but the employee must enter the information into the application; he or she is not allowed to submit the employer-completed section.

Health e(fx) solves this issue of incomplete employer information and automates the generation of all employee notifications. It also solves what could be overwhelming and unsustainable pressure on the HR/Benefits staff to complete forms and act as advisors to perhaps thousands of employees trying to meet enrollment deadlines. The Health e(fx) system has automated the entire notification process. After an employee census data load, all the information needed for an individual employee is pre-filled in the model notice and the Marketplace Employer Coverage Tool. Employers can send the form to a fulfillment vendor to mail or email by the deadline. The employee now has all the information needed: employer name, address and contact, affordability information, and the cost of the QHP the employer offers. The employee then can use the Marketplace tools and compare offered plans. If the Marketplace has a plan that meets the employee’s needs, he or she now has everything needed to make an informed decision and complete the application in a timely manner without the need to call the HR department for data, questions, and manual workarounds.

October 1 is approaching quickly, and there is still much confusion around the ACA, the Exchange/Marketplace offerings (for example, Utah announced that its citizens will be able to choose from 99 different plans!), and employer plan changes and pricing. It is going to be a very long fall and a difficult enrollment season for employers on a calendar year plan who have made substantial changes to meet the ACA requirements. No one is exempt from the Notice of Exchange/Marketplace coverage delivery. The penalties are unclear, if any, for employers’ failure to deliver the notice in a timely manner or at all. Failing to deliver violates the ACA and the Fair Labor Standards Act (FLSA), subjecting employers to investigations and possible monetary punishment. And any employee reporting the failure to distribute will have full employment protection under the ACA.

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