Smart Benefits: Employer Exchange Model Notice Released Early
Monday, May 27, 2013
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
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.
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.
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