EMPLOYER “DID YOU KNOW” PPACA FACTS

Some employers are unaware of some very important requirements and looming deadlines by which they must abide under the new health care law. We have grown accustomed to seeing the IRS and HHS named as the governing bodies in the implementation and enforcement of the PPACA, but the Department of Labor (DOL) is the third agency that is tasked with implementing and governing the new law. Below are a few often overlooked provisions that the DOL has published. Leaders of religious institutes and business office personnel should take notice and make sure that their sponsored ministries are compliant.

(1) Employers Must Give Employees Notice of Coverage Options by October 1, 2013 
Originally set for March 1, this deadline was extended until October 1, the same date that the state marketplace exchanges are set to open for business. See http://www.dol.gov/ebsa/newsroom/tr13-02.html.

This provision applies to virtually ALL employers no matter how many employees you have. It is incorporated into the Fair Labor Standards Act (FLSA), and it requires employers to provide a notice of coverage options to each employee, regardless of plan enrollment status (if applicable) or of part-time or full-time status. (Employers are not required to provide a separate notice to dependents.)

•  Employers are required to provide the notice to each new employee at the time of hiring beginning October 1, 2013. For 2014, the Department will consider a notice to be provided at the time of hiring if the notice is provided within 14 days of an employee’s start date. 
• With respect to employees who are current employees before October 1, 2013, employers are required to provide the notice not later than October 1, 2013. The notice is required to be provided automatically, free of charge. 

The notice must be provided in writing in a manner calculated to be understood by the average employee. It may be hand-delivered directly to the employee, provided by first-class mail, or delivered electronically (if the employee has access to email at work and is sure to get it). Posting a central notice in a common area does not suffice.

The notice that an employer sends must be in writing and it must inform the employee:

• …of the existence of the Marketplace (Exchange) including a description of the services provided by the Marketplace, and the manner in which the employee may contact the Marketplace to request assistance; 
• …that 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 if the employee purchases a qualified health plan through the Marketplace; and 
• …that if the employee purchases a qualified health plan through the Marketplace, 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. 

Sample Notices for Employers to Adapt for Employees
-For a sample notice that employers can use for employees to whom they offer health insurance coverage, go to this link.
-For a sample notice that employers can use for employees to whom they do NOT offer health insurance coverage, go to this link.
The differences in these notices is very subtle, but be careful to use the correct one. Also, be sure to fill in the blanks with the applicable contact information when called for.

(2) Automatic Enrollment in Health Plans when employers have more than 200 employees http://www.dol.gov/ebsa/faqs/faq-aca5.html
PPACA amended the FLSA by adding a new section requiring employers with more than 200 full-time employees to automatically enroll new full-time employees in the employer’s health benefits plans and continue enrollment of current employees.

What Agency is responsible for guidance under this new FLSA provision? 
The Secretary of Labor has delegated responsibility for rulemaking and for regulations of this new provision to the Employee Benefits Security Administration (EBSA) within the DOL. EBSA and the Department of the Treasury will coordinate to develop the rules that will apply in determining full-time employee status for purposes of the amendments to the FLSA and the rulemaking by the Treasury Department under the Internal Revenue Code to develop the rules that will apply in determining full-time employee status.

When do employers have to comply with the new automatic enrollment requirements of the FLSA? 
Are you ready for this answer? Section 18A provides that employer compliance with the automatic enrollment provisions of that section shall be carried out “[i]n accordance with regulations promulgated by the Secretary [of Labor].” Accordingly, it is the view of the Department of Labor that, until such regulations are issued, employers are not required to comply with section 18A. The Department of Labor expects to work with stakeholders to ensure that it has the necessary information and data it needs to develop regulations in this area that take into account the practices employers currently use for auto-enrollment and to solicit the views and practices of a broad range of stakeholders, including employers, workers, and their families. The Department of Labor intends to complete this rulemaking by 2014.

(3) Ninety Day Waiting Period Limitation for New Employee Coverage (Link is here)

New DOL regulations propose that a group health plan, and a health insurance issuer offering group health insurance coverage, not apply any waiting period that exceeds 90 days. (Neither a plan nor an issuer offering coverage is required to have any waiting period.) If, under the terms of the plan, an employee can elect coverage that becomes effective on a date that does not exceed the 90-day waiting period limitation, the coverage complies with the waiting period rules, and the plan or issuer will not be considered to violate the waiting period rules merely because individuals choose to elect coverage beyond the end of the 90-day waiting period.

This provision is effective January 1, 2014. The proposed regulations have several sample scenarios to help employers figure out if their plans are or will be compliant with the provision when it takes effect.