Smart Benefits: Employer Exchange Model Notice Released Early

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Monday, May 27, 2013

Amy Gallagher, GoLocalWorcester Business/Health Expert

The health insurance Exchange employer model notice and guidance to employees was released last week by the Department of Labor, ahead of its expected release date.

Notice Drivers

The notice is required by healthcare reform as another means to expand access to quality healthcare for consumers. It has three primary purposes:

• To explain coverage options to employees available through the state Exchange marketplaces, which open for business on January 1, 2014.
• To help employees find out about possible premium tax credits if the employer's health plan does not provide minimum value or affordable coverage.
• To inform employees that they could risk losing any employer contribution and the tax deductibility of the employees’ share of the premium if they purchase through the Exchange
   

Model Requirements

There are two versions of the model notice: one for employers who provide health plan coverage and another for those who don't.

The former includes sections for the employer to complete about whether its coverage is affordable and provides minimum value. Employers should make sure they have done calculations to determine affordability and get certification of minimum value before distributing these notices to employees.

Distribution Deadline

With open enrollment for the Exchange marketplaces running from October 1 through December 31, the notice must be provided no later than October 1 to existing employees and within 14 days of hire for new hires starting after October 1.

Employers must distribute the notice to employees in writing either by first class mail or electronic means, as long as the employer follows the safe harbor process.

Amy Gallagher has over 19 years of healthcare industry experience. As Vice President at Cornerstone Group, she advises large employers on long-term cost-containment strategies, consumer-driven solutions and results-driven wellness programs. Amy speaks regularly on a variety of healthcare-related topics, is a member of local organizations like the Rhode Island Business Group on Health, HRM-RI, SHRM, WELCOA, and the Rhode Island Business Healthcare Advisory Council, and participates in the Lieutenant Governor’s Health Benefits Exchange work group of the Health Care Reform Commission.

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