ACA Group Spotlight: Model Notice of Exchange


On May 8, 2013 the U.S. Department of Labor provided guidance on the Notice of Coverage Options for the Exchange.  While we may refer to the Exchange now as the Health Insurance Marketplace the need for employers to give notices to employees by October 1, 2013 has not changed.  In fact, the Department of Labor has stated that all employers subject to the Fair Labor Standards Act must provide the notice, even if health coverage is not offered to employees and the delay of pay or play penalties does not affect the due date of the notice.

Here is some additional guidance on the Notice of Exchange Options:

Where is the notice?

You can find the notice on the U.S. Department of Labor website.  There are two different notices.  Thefirst is for employers who offer benefits through their company.  The second is for employers who do not offer benefits.  A notice must be sent to all employees whether a company offers benefits or not.  AUI has copies of these notices that can be filled out and saved to a computer for future reference.  If you would like a copy of one or both of these notices you can request them here.

Who must receive the notice?

All current employees must receive copies of the notice.  This includes all full-time, part-time, and currently employed seasonal workers.   The notice does not have to be provided to dependents.

When must the notice be provided to employees?

The notice must be provided to current employees by October 1, 2013.

What about new employees?

New employees must receive a copy of the notice within fourteen days of their start date.  In other words, the notice is considered as being provided at the time of hire.

How must the notice be delivered?

The notice must be in writing and can be physically or electronically distributed.  However, in order to be delivered electronically by the employer ERISA standards for electronic delivery must be met.  The easiest way to determine if the standards are being met is that if an employee uses a computer in their daily work activities then electronic delivery is most likely acceptable.

What does the notice have to say?

The Department of Labor has indicated that employers can write their own notices so long as they meet certain criterion; we recommend you stick closely to the notices supplied by them.  AUI has created model notice forms that meet all of the criterion and can be saved to your computer.  If you would like a copy of one or both of these notices you can request them here.

Do I have to provide a notice to my employees?

Good question.  The Federal Government has ordered that all employers who fall under the Fair Labor Standards Act provide notices to employees.  That said, there is no clear language on penalties for failing to give a notice.  We recommend that employers simply complete the forms and distribute them to all employees by October 1, 2013 and to all new employees on their first day of work.

If you have additional questions about the Model Notice of Exchange, we would love to answer your questions.  Please contact us here or by phone at 1-800-671-7665.

Chris Johnston

We do more than cover small businesses and individuals with the right insurance policies and benefit plans – what motivates our team is helping you save more so you can invest more in your team, family, and goals.

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