Become a Member

< Back to All

FAQ — Health Insurance Exchange Notice

August 19, 2013

A specific provision of the Affordable Care Act that impacts ALL employers – regardless of size – takes effect October 1, 2013. The law states that all employers must provide each employee (both full-time and part-time) with a notice regarding the new Health Insurance Marketplace (exchange) by October 1, 2013.

To be compliant with the Department of Labor, an employer that offers a sponsored health plan to any of their employees should provide a model notice that explains the coverage available and also notifies them of the health insurance exchange. There is a separate model notice for employers that do not offer health insurance as an employee benefit. Going forward, new hires must receive notice with 14 days of their start date of employment.

Since our announcement of this requirement and of our service to provide a solution, we have had several recurring questions.  Here are some frequently asked questions (and answers) that may help clear up some of your questions regarding this new employer requirement:

Do all employers have to provide the Marketplace Notice?

Most, but not all.  All employers subject to the Fair Labor Standards Act (“FLSA”) are required to provide the Notice. Additionally, the Notice must be provided by both employers that offer health insurance as an employee benefit and those that do not. Click here to find out if your company is required. 

Which employees must receive the Notice?

All employees (full-time, part-time, seasonal, etc.) must receive the Marketplace Notice, even employees who are not enrolled in their employer’s health plan. Employers are not required to provide the Marketplace Notice to dependents, spouses, or domestic partners who are not employees.

What information must the Notice contain?

Generally, the Marketplace Notice must contain the following:

  • Information about the existence of the new Marketplace, including contact information and a description of the Marketplace’s services;
  • A statement that the employee may be eligible for a premium tax credit if the employee purchases a qualified health plan through the Marketplace; and
  • A statement that if the employee buys a qualified health plan through the Marketplace, the employee may lose the employer’s contributions (if any) to any health plan offered by the employer and that all or a portion of the employer’s contribution may not be subject to federal income taxes.

Additionally, the model Notice for employers offering a health plan includes the following information:

  • Employer’s contact information
  • The plan’s eligibility rules for employees and their dependents
  • A check box that, when checked, means the employer’s coverage meets the minimum value standard, and the cost of the coverage is intended to be affordable to the employee “based on employee wages”

Where Can I find a Copy of the Notice?

There are two separate Model Notices provided by the Department of Labor.  One Notice is for employers that offer health insurance as an employee benefit and another is for employers who do not offer health plan coverage to their employees. 

SBAM members have access to a new service which provides these letters at a minimal cost.  Our partner, Lake Michigan Mailers, has created a secure, easy-to-use website designed to help you satisfy the requirement by sending out the notices to your employees. To take advantage of this service, please click here.

The Lake Michigan Mailers ACANotice.com website will help you quickly and easily complete the information required by the Affordable Care Act, and securely upload each of your employee addresses.   Lake Michigan Mailers will create the appropriate notice (written in English or Spanish), as provided by the Department of Labor, and mail the notices via First-Class mail prior to the October 1, 2013 deadline.  This service is very affordable for our members: a one-time $30.00 processing fee plus $.60 per employee address.

Can the model Notice be changed?

Yes, but our advice is to remain with the Model Notices the DOL has provided.  Please note that these Notices also contain some information that is optional for employers, including this information will create additional administrative hurdles and costs for employers.

When and how must the Notice be provided?

There are two important dates to keep in mind:

  • For current employees and those hired before October 1, 2013 the Notice must be provided no later than October 1, 2013.
  • For new employees hired on or after October 1, 2013, the Marketplace Notice must be provided within 14 days of the employee’s start date.

The Notice can be provided by first-class mail.  It can also be provided electronically if the DOL’s electronic disclosure safe harbor requirements are met. The Notice must be written so that it can be understood by the “average” employee.  Again, our advice is to use the Model Notice provided by the DOL and our service with Lake Michigan Mailers will provide the Notice in both English and Spanish.

How do I create a CSV file to upload onto the ACAnotice.com site?

When you upload your employee address data securely to ACAnotice.com, it must be in a CSV format.  This can be done in a few simple steps.

1. Create an Excel spreadsheet with the required employee data.
2. Choose ‘Save As’ once you are finished with the spreadsheet.
3. In the drop down list of ‘Save as Type’ under ‘File Name’ choose CSV (Comma Delimited) and choose your Computer Desktop as the location in which to save this file.
4. A pop-up box may appear asking if you wish to use the CSV format.  Choose ‘Yes.’
5. When you close out the spreadsheet, a prompt may appear inquiring as to whether or not you wish to keep it in the CSV format.  Choose ‘yes’ again, and if the system asks you to choose ‘save’ again, do so.

What information is included in the model Notices?

The model Notice for employers offering a health plan includes the following information:

  • Employer’s contact information
  • The plan’s eligibility rules for employees and their dependents
  • A check box that, when checked, means the employer’s coverage meets the minimum value standard, and the cost of the coverage is intended to be affordable to the employee “based on employee wages”

How do I know if  my employer coverage meet the minimum value standard?

The law states that every company-sponsored health plan must be at a ‘Bronze’ level or higher beginning in 2014 and BCBSM/BCN are adhering to that requirement. A ‘Bronze’ level of coverage has at least 60% of health care costs covered by the plan and the employee would cover the remaining 40% through copayments, deductibles and coinsurance. 

Do I need to provide a Notice to employees currently on COBRA coverage?

There are no provisions that we can find that require this Notice be sent to former employees currently taking advantage of COBRA.  That said, for those employers subject to COBRA requirements, please know that the DOL has changed the model COBRA election notice.  This change specifically notes that individuals eligible for COBRA also may want to consider and compare health coverage available through the Marketplace.

For employers taking advantage of Small Business Administrative Services (SBAS) COBRA Administration we have updated our letter to include this revision.  The new COBRA election notice informs qualified beneficiaries that other coverage options are available through the Marketplace, and that being eligible for COBRA does not impact an individual’s eligibility for a tax credit through the Marketplace. It also removes the paragraph about preventing a gap in creditable coverage, since plans will not be permitted to impose preexisting condition limitations beginning January 1, 2014.

Share On: