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Federal officials have delayed a March 1, 2013, deadline that requires employers to notify employees in writing about the availability of public health insurance exchanges.

Navigating health reform

Employers Have More Time to Communicate Health Insurance Exchanges

  • 2/8/2013
Update 7/8/2013: In July 2013, the Obama administration announced the employer mandate provision of the ACA would be delayed one year and not take effect until January 1, 2015. 


Employers Have More Time to Communicate Health Insurance Exchanges

The Affordable Care Act requires employers to provide their employees with a written notice explaining a state’s health insurance exchange and how an employee may access the exchange.

But federal officials have delayed a March 1, 2013, deadline that requires employers to notify employees about the exchanges until regulations and a model notice with generic language have been issued. The Department of Labor anticipates final regulations will be available in the early fall of 2013.

“This is great news because it gives employers more time to prepare for compliance,” says Kelly Davis, an employee benefit plans manager with CliftonLarsonAllen. “Employers should take advantage of this additional time to evaluate their employee and health plan information while implementing processes to help gather the required information.”

The Notice of Exchange requirement is set forth in Section 18B of the Fair Labor Standards Act (FLSA), and applies to employers as defined by the FLSA, as “any person acting directly or indirectly in the interest of an employer in relation to an employee.”

With state exchanges set to be operational on January 1, 2014, employers will be required to provide the Notice of Exchange to all active employees prior to the beginning date of the exchange and subsequently to any new hires.

The notice will inform employees about:

  • The existence of the state exchange and a description of the services provided
  • Eligibility for a premium tax credit or a cost-sharing reduction if their employer's plan does not meet certain requirements and the employee purchases coverage through the state exchange
  • The potential loss of any employer contributions to an employer-sponsored health plan and that all or a portion of an employer contribution toward employer-provided coverage may be excludable for federal income tax purposes
  • Whom they should contact at the state exchange for assistance
  • Their appeal rights

Until further guidance and the model Notice of Exchange have been issued, employers can plan for compliance by summarizing information about their employer-sponsored coverage, including items such as:

  • Employer name, EIN, and contact information
  • Employee’s name, hours worked per week, and their full or part-time status
  • Employee’s enrollment date for employer-sponsored coverage
  • Whether health coverage is being provided to the employee
  • Employee and employer contribution amounts
  • Frequency of contributions
  • Name of the lowest cost plan providing minimum value

How we can help

Compliance will be less painful if you are preparing along the way. We can help you determine if you are ready with your information once it is time to deliver the Notice of Exchange to employees.

Kelly Davis, Employee Benefit Plans Manager, 480-615-2383