Employers Must Provide ACA Exchange Notice by October 1

One of the provisions of the Affordable Care Act (“ACA” or “Obamacare”) requires employers to provide ALL employees with a notice about the health insurance exchanges. This year’s deadline is October 1st.

The notice must inform employees of three essentials:

  • Health insurance exchanges exist on federal and state levels (as applicable).
  • Employees may be able to obtain tax credits by purchasing health insurance from an exchange if there is no employer-sponsored plan, if it covers less than 60% of total allowed benefit costs or if the particular employee is ineligible for the employer-sponsored plan.
  • Employees whose employers provides health insurance that meets the 60% threshold should not purchase plans through an exchange.  Doing so could cause them to lose employer-sponsored coverage and associated tax advantages.

The provisions for the notice include:

  • May be provided in writing or electronically.  Electronic notices must meet certain guidelines.
  • Must be provided automatically without employees having to request it or opt in.
  • Must be written in plain, readily-understood language.
  • Must be free of charge to employees.
  • Must be provided to all employees – full-time and part-time, regardless of whether or not they participate in the employer-sponsored health insurance plan.

The U.S. Department of Labor has issued preliminary guidelines for the ACA Exchange Notice, including two models:

Your AKM CPA is ready to assist you with any questions and to help you ensure compliance.  As with all such requirements, there is a penalty for failure to comply.

This entry was posted in Alerts, Bulletins, News.