Improving health is our policy
Mandates that employers inform employees about the availability of the health insurance exchange in their state. If the employer’s plan does not cover at least 60% of the actuarial value of the total benefit under the plan, then the employee is eligible to purchase insurance in that exchange. If an employee enrolls in the exchange, they are not eligible for employer contributions to health benefits offered by the employer.
2013
On January 24, 2013, the Department of Labor (along with HHS and the IRS) posted an FAQ that, in part, delayed this requirement, initially scheduled to take effect on March 1, 2013. DOL now expects to issue new notices in this regard in late summer 2013.
On May 8, the DOL issued a technical release providing guidance on requirements under this section regarding notice to employees of coverage options through Health Insurance Marketplaces. DOL also updated model election notices used by group health plans under COBRA to note Marketplace coverage options. Specific DOL documents include: Model Notice for Employers Who Offer a Health Plan to Some or All Employees; Model Notice for
Employers Who Do Not Offer a Health Plan; COBRA Model Election Notice; and COBRA
Model Election Notice Redline Version (showing May 2013 changes).
On June 21, pursuant to this section’s provision on employee notification of coverage options through Health Insurance Marketplaces, the DOL issued a Model Notice for Employers who Offer a Health Plan to Some or All Employees (in Spanish), as well as a Model Notice for Employers who do Not Offer a Health Plan (in Spanish).
On August 15, DOL published an proposed extension of a currently approved information collection under this section titled, “Notice to Employees of Coverage Options under Fair Labor Standards Act Section 18B.” It notes an estimated 6,160,461 respondents, 72,484,292 responses, 374,502 total burden hours and $12,229,992 burden cost and, relative to a Model Notice, indicates that “OMB approval of the revision currently is scheduled to expire on November 30, 2013.” Comments are due by October 15.
On September 4, DOL, HHS and Treasury issued FAQs clarifying that the ACA’s required Employee Notice of Marketplace Coverage Options need not be distributed by the employer directly. However, if an issuer, multi-employer plan or third-party administrator circulates the notice, employers may have “residual obligations” to assure all employees – including those not enrolled in the plan – receive the statutorily required notice. Separately, the FAQs address the ACA’s 90-day waiting period limitation, noting that employers can “rely on guidance provided in the March 2013 proposed rules at least through 2014” and that “to the extent final regulations are more restrictive on plans or issuers than the proposed regulations, they will not be effective prior to January 1, 2015 and the Departments expect they will give plans and issuers sufficient time to comply.”
On September 11, DOL posted an FAQ clarifying that under the ACA requirement that certain employers inform employees of Marketplace coverage options, employers cannot be fined for failing to provide the notices.
On September 17-18, DOL held webinars on ACA compliance; they are available in archived form, and registration is required. In the first call, DOL discussed final regulations on employer wellness programs, while Treasury presented on the employer mandate. In the second call, DOL discussed the ACA requirement to provide employees with a Notice of Marketplace Coverage Options, and HHS presented on Marketplaces and SHOPs.
On Nov. 26, the IRS and Treasury released notices (here and here) seeking comment on proposed information collections through which applicable large employers, insurers and self-insured plans report on coverage.
On Nov. 26, the IRS published two notices (here and here) on estimated reporting burden under Form 1094-B and Form 1095-B for minimum essential coverage by insurers and additional information reporting by applicable large employers. Comments were due by Dec. 26.
2015
On Feb. 25, the IRS released a publication designed to assist employers in understanding ACA information reporting requirements.
On Mar. 7, the IRS posted a publication, “Affordable Care Act: What Employers Need to Know,” that addresses information reporting and other topics.
On May 8, the Treasury Inspector General for Tax Administration issued a report finding that IRS’ delay in employer and insurer information reporting “reduces the IRS’s ability to determine whether taxpayers and their dependents” have ACA minimum essential coverage.” It explores the agency’s individual mandate enforcement mechanisms and recommends that the penalty calculator, known as the Shared Responsibility Payment Calculation Tool, be added to IRS.gov for the 2016 filing year.
On July 30, in a “tax tip,” IRS explains the employer mandate and associated information reporting requirements.
2016
On May 11, the IRS posted a “tax tip” titled “Why Employers Need to Count Employees.”
On July 29, the IRS released a proposed rule that addresses delayed Form 1095-B information reporting by catastrophic health plans as well as provides for information reporting by the state agency administering ACA Basic Health Programs, among other provisions. Comments are due by Oct. 3, 2016.
On Aug. 3, the IRS issued proposed regulations providing rules requiring issuers to report coverage under a catastrophic plan enrolled in through the Marketplace, clarifying the circumstances under which reporting is not required for an individual covered by more than one plan or program that is minimum essential coverage.
On Sept. 29, the IRS announced that software developers and transmitters may access recent webinars on ACA Information Return processes (Aug. 23 slides; Aug. 20 slides; July 19 slides; July 14 slides).
On Nov. 18, the IRS posted a notice indicating that it was extending the due date for certain 2016 information reporting requirements. The IRS indicated that “[s]pecifically, this notice extends the due date for furnishing to individuals the 2016 Form 1095-B, Health Coverage, and the 2016 Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from January 31, 2017, to March 2, 2017,” and “also extends good-faith transition relief from section 6721 and 6722 penalties to the 2016 information-reporting requirements under sections 6055 and 6056.”
2017
On April 10, the Treasury Inspector General for Tax Administration released a report on employer mandate implementation and made seven recommendations regarding the IRS’ processing of Forms 1094-C and 1095-C.
SEC. 1512. EMPLOYER REQUIREMENT TO INFORM EMPLOYEES OF
COVERAGE OPTIONS.
The Fair Labor Standards Act of 1938 is amended by inserting
after section 18A (as added by section 1513) the following:
‘‘SEC. 18B [29 U.S.C. 218b]. NOTICE TO EMPLOYEES.
‘‘(a) IN GENERAL.—In accordance with regulations promulgated
by the Secretary, an employer to which this Act applies, shall provide
to each employee at the time of hiring (or with respect to current
employees, not later than March 1, 2013), written notice—
‘‘(1) informing the employee of the existence of an Exchange,
including a description of the services provided by such
Exchange, and the manner in which the employee may contact
the Exchange to request assistance;
‘‘(2) if the employer plan’s share of the total allowed costs
of benefits provided under the plan is less than 60 percent of
such costs, that the employee may be eligible for a premium
tax credit under section 36B of the Internal Revenue Code of
1986 and a cost sharing reduction under section 1402 of the
Patient Protection and Affordable Care Act if the employee
purchases a qualified health plan through the Exchange; and
‘‘(3) [As revised by section 10108(i)(2)] if the employee purchases
a qualified health plan through the Exchange and the
employer does not offer a free choice voucher, the employee
may lose the employer contribution (if any) to any health benefits
plan offered by the employer and that all or a portion of
such contribution may be excludable from income for Federal
income tax purposes.
‘‘(b) EFFECTIVE DATE.—Subsection (a) shall take effect with respect
to employers in a State beginning on March 1, 2013.’’.
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