|We were working on a notice to all of our clients, to make sure you were aware of the 10/1/13 notification requirements regarding Obamacare, or what's left of it - which is regulations and, depending on your State, the individually mandated coverage. However, we just received the following from Word & Brown General Agency - one of the country's premier Health Insurance outlets and an outlet for individual plans in or out of the exchanges. While they are located here in California, what is following below is applicable to most of the country - and I couldn't have said it better myself. So, I have no doubt that they are fine with our using their notice as a notice to our clients and friends.
This comes from Jeff Miller, Regional Vice President of Word & Brown General Agency and a long time critical member of the Word & Brown team. Jeff is located at the Word & Brown offices at 721 S. Parker, Ste 300, Orange, CA 92868 (800-869-6989).
It is important to know that all of the forms and rules are available at http://www.dol.gov/ebsa/healthreform/. We also have copies of some of the forms you need to put to your letterhead, and below is the main notice forms. Simply cut & paste these links into your browser to see more detail and forms !
So, here you go - what you need to know as respects this initial notification and the 10/1/13 deadline:
Exchange Notice to Employees Due by October 1, 2013
The Affordable Care Act (ACA) requires all employers subject to the Fair Labor Standards Act (FLSA)* to provide notices to all current employees and new hires regarding the new Health Insurance Marketplace (in CA, Covered California) and the subsidies available to qualified individuals. The notices to current employees must be provided no later than October 1, 2013. Here are some helpful tips and resources:
- Both employers offering coverage and those that do not offer coverage must provide notices. The Department of Labor (DOL) has provided model notices in English and Spanish; the English versions are here:
- All current employees must receive these notices - full-time, part-time, and seasonal - whether or not they are eligible for or currently enrolled on the employer-sponsored plan.
- Current COBRA beneficiaries also should receive a notice by 10/1/2013. DOL has provided a new COBRA Model Election Notice in English and Spanish [located at the main website noted above].
- Both union and non-union employees must receive notices. The employer should contact the union representative to coordinate delivery of notices to union employees.
- Notices may be distributed in a number of acceptable ways that ensure each current employee and COBRA beneficiary receives one: hand-delivery,** first- class mail, or electronically (in a means that meets the DOL safe harbor electronic disclosure criteria as outlined in Technical Release 2011-03R). [contact email@example.com for this information]
- Documentation proving receipt of notice is not required by law. However, some employers may want to keep a record so we created a sample receipt to save you and your clients valuable time [contact firstname.lastname@example.org for this notice]
- In response to requests for help in wording a memo to employees explaining the reason for the notice, we've supplied a sample employer memo [ contact email@example.com for a sample]
- On page 2 of the model notice for employers with coverage it reads "If checked, this coverage meets the minimum value standard, and the cost of this coverage is intended to be affordable, based on employee wages." The minimum value (MV) standard means the plan pays 60% or more of the covered benefits in-network. Affordability means full-time employees pay no more than 9.5% of their W-2 Box 1 income or rate of pay for self-only coverage on the lowest cost plan offered by the employer that meets the minimum value standard (60%).
- Page 3 of the DOL model notice for employers with coverage is OPTIONAL. (This page requires entry of information specific to each employee including their portion of the monthly premium for the lowest cost plan offered that meets the minimum value standard. Since the deadlines for final decisions regarding 12/1/2013 early renewals are after this 10/1/2013 notice deadline, many small employers will not have this information.)
- New hires (full-time and part-time) should receive a notice within 14 days of hire date.
- The expiration date on the current DOL model notices is November 30, 2013 . We will notify you via email when the new model notices become available.
- Employers may have another entity (such as a TPA) handle the distribution of these notices on their behalf, but it is the employer's responsibility to make sure notices go out to all of the employees (not just those enrolled on the employer-sponsored plan) within the required timeframe (see Q&A #1 in FAQs on ACA Implementation Part XVI.
*In general, the FLSA applies to employers that employ one or more employees who are engaged in, or produce goods for interstate commerce. For most firms, a test of not less than $500,000 in annual dollar volume of business applies. The FLSA also specifically covers the following entities: hospitals; institutions primarily engaged in the care of the sick, the aged, mentally ill, or disabled who reside on the premises; schools for children who are mentally or physically disabled or gifted; preschools, elementary and secondary schools, and institutions of higher education; and federal, state and local government agencies. For further assistance with determining whether or not a specific employer must comply with FLSA, here is a link to the DOL elaws: Fair Labor Standards Act (FLSA) Advisor. - Do I have to comply with the FLSA? http://www.dol.gov/elaws/esa/flsa/scope/screen24.asp
- Some small employers may not be subject to FLSA because they are not involved in interstate commerce and do not meet the test of not less than $500,000 in annual dollar volume of business (exclusive of taxes at the retail level). It is important to remember IRS common ownership rules apply. Therefore, an employer with several small businesses may be one "enterprise" that is subject to FLSA.*
** We have seen material from other sources indicating these notices cannot be hand-delivered; but must be mailed to the employees' home addresses. We contacted Elizabeth Schumacher, the DOL/EBSA contact person whose name appears on Technical Release 2013-02 (Click HERE). Ms. Schumacher indicated employers may distribute these notices via first-class mail or electronically (in accordance with the DOL safe harbor for electronic disclosure), but these are not the only approved methods of delivery. Hand delivery is an acceptable means of distribution. For example, small employers may hand-deliver these notices when they pass out checks, distribute renewal packets, or give new hire kits.