What Do I Need to Tell My Employees about ObamaCare?
Notice of Health Care Coverage Options Rules Confuse Employers: We Tell You What You Need to Know – The Truth
What do you need to tell your employees about ObamaCare as a small business? The $100 fee is a myth, but you still need to tell your employees about the marketplace. The week after Labor Day, news stories started appearing that frightened employers with at least a single employee and annual revenues that exceeded $500,000 per year.
According to the news reports, even though the implementation of the employer mandate for providing health insurance coverage if a business had 50 or more full-time employees or be fined $2,000 per-worker is delayed one year, employers must let know employees of coverage availability at the state exchanges by October, 1, 2013. Notification is by letter. Notification to new employees must occur within two weeks of starting work. Failure to comply with this need subjects any employer with a business regulated by the Fair Labor Standards Acts to a fine of up to $100-per-day.
The $100-per-day fee for not telling your employees about ObamaCare is a myth, but you are still supposed to tell your employees about the Health Insurance Marketplace. You just won't be fined for it.
Information That Must Be Included in the Written Notice to Your Employees
If your company is covered by the Fair Labor Standards Act, you must provide a written notice to employees informing them:
- About the the Health Insurance Marketplace
- That, depending on any coverage you offer, they may be able to get lower costs on private insurance in the Marketplace based on their income
- That if they buy insurance through the Marketplace, they may lose the employer contribution (if any) to their health benefits
You must provide these notices to all employees by October 1, 2013. This is true regardless of their full-time or part-time status or whether they’re enrolled in your health care plan (if you have one). You must do the same for all new hires starting October 1, 2013.
There is no daily fine for failing to meet this requirement.
Get more details and guidance on employee notices in the U.S. Department of Labor’s Technical Release 2013-02.
The Affordable Care Act Notice To Employees
Here is the official wording of Sec. 18B. from Title I of the Affordable Care Act in regards to what the notice to employees should include:
‘SEC. 18B. 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) if the employee purchases a qualified health plan through the Exchange, the employee will 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.’.
History of the $100-per-day Fee ObamaCare Employee Myth
The panic appears to have begun when a cable business show interviewed a prominent business attorney who remarked that even though the government suspended the employer mandate this provision of the law has been “unfortunately overlooked.” The attorney commented that since notification is part of the Affordable Care Act and the FLSA, both containing penalties, businesses would be facing financial liability.
The Truth: There is No Penalty for Not Telling Your Employees About ObamaCare
The Department of Labor issued a Technical Release summarizing the FLSA definition of an employer for purposes of providing notification of the exchanges. The Technical Release informed employers that no small employer exemption exists and they must send the notices even if they do not offer a health insurance plan.
The Department of Labor has model notices that employers can use to comply with the regulation. First class mail is the preferred way for notification. However, electronic mail is acceptable if it complies with the DOL electronic safe harbor elements.
However, at the end of the Technical Release is Footnote 4. Clicking on Footnote 4 takes you to a FAQ of the Department of Labor. It provides the following language:
“Can an employer be fined for failing to provide employees with notice about the Affordable Care Act's new Health Insurance Marketplace?
A: No. If your company is covered by the Fair Labor Standards Act, it should provide a written notice to its employees about the Health Insurance Marketplace by October 1, 2013, but there is no fine or penalty under the law for failing to provide the notice.”
You Won't Get a Fine, But You Should Still Let Your Employees Know They Can Get Health Insurance Through the Marketplace
On September 12, 2013, the United States Small Business Administration posted details on the notification requirements.
The post is part of the SBA/s informative series Myth vs. Fact: The Affordable Care Act and Small Business, of Titled: Myth #3: Business Owners Will Be Fined If They Don’t Notify Their Employees About the New Health Insurance Marketplace.
The series debunks myths and lies about the Affordable Care Act.
The SBA assures its audience that the facts of the notifications are:
“If your company is covered by the Fair Labor Standards Act, you must provide a written notice to your employees about the Health Insurance Marketplace by October 1, 2013. However, there is no fine or penalty under the law for failing to provide the notice.”
It is clear that the administration is relying on the help of the business community to get the word out about the State’s Health Care Exchanges. However, there is no penalty for not cooperating.
By law, businesses must notify employees about the availability of affordable health insurance from state exchanges by October 1, 2013. There is no penalty for non-compliance in 2013. Help to do your part and make sure your Employees know about about ObamaCare and that they can get cost assisted health insurance through their State's marketplace.