State Streamlines Notices to Employees on Health Exchanges

Posted by Russ Sullivan on Aug 29, 2013 10:52:00 AM

Massachusetts employers now have access to a single template that will ensure compliance with all state and federal health-care reform requirements to tell employees about state health-insurance marketplaces.

Health care reformThe Massachusetts Health Connector yesterday released a model employee notice of health insurance marketplaces.  The Massachusetts notice contains the information required by the federal Affordable Care Act (ACA), as well as additional information required of Massachusetts employers.  AIM worked closely with the Connector to reduce the federal and Massachusetts notice requirements into one, simplified employee notice.

So Massachusetts employers who use the Connector notice will be compliant with both federal and Massachusetts health care notice requirements.

The U.S. Department of Labor released its own model employee notices of health care exchanges earlier this year.  The Affordable Care Act (ACA) requires that all employers subject to the Fair Labor Standards Act (generally employers engaged in interstate commerce with at least $500,000 in annual revenue) provide the notice to all existing employees by October 1, 2013 and to all subsequently hired employees within 14 days of their hire date.  There are two separate federal notices – one for employers who provide health insurance and a second for those who do not.

The Massachusetts Health Connector notice differs from the federal notices in several ways:

  • The Connector notice provides information on section 125 plans.  Under Massachusetts health care reform, employers with 11 or more full-time employees were required to offer workers who did not qualify for employer- sponsored health insurance the opportunity to purchase individual insurance through their employer’s section 125 plan.  Although the ACA does not allow the use of a section 125 “cafeteria plan” for individual purchase of insurance policies through a public marketplace like the Massachusetts Health Connector, it does allow employees to use their employer’s section 125 plan to purchase individual policies through a private insurance source.
  • The Connector provides one notice that can be used for all employers whether or not the employer provides health insurance. 

The Connector notice contains all key elements of the federal notice but customizes the language for Massachusetts:

  • Notice to employees of the Massachusetts Health Connector as a “one-stop” shop for finding health insurance plans;
  • Information on the availability of subsidies to qualifying individuals;
  • A statement that the employer’s plan may affect the eligibility of an employee to qualify for certain subsidies;
  • A statement that choosing health insurance through the Massachusetts Health Connector may cause the individual to lose any contribution that his or her employer may make towards the cost of health insurance premiums.
  • A link to www.MAhealthconnector.orgfor more information

The Massachusetts notice also contains a two-page, optional supplement in which employers can provide information on the eligibility requirements for their health plan, confirmation that the plan meets ACA minimum-value requirements, the employee cost for the lowest cost employee only plan of minimum value, and employer information such as employer name, address, EIN, contact, contact phone number and contact email. Employers should to assess whether adding two pages to the notice will outweigh the value of the information provided.

The Connector notice applies to Massachusetts residents only. Massachusetts employers must use the federal notice for their out-of-state employees.  Employers who use the federal notice for their Bay State employees will need to provide an additional notice to employees about section 125 plans using language similar to that contained in the Connector notice.

None of the new notices need to be signed or retained.

You can access the notice, the supplemental notice and additional information at the following link:

Health Care Terms

Topics: Health Care Reform, Health Care Costs, Issues

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