By Chris Frye, CPA

A widely overlooked provision of the Affordable Care Act is set to go into place in a matter of days.  Open enrollment for the new state or Federal run health insurance exchanges is scheduled to begin on October 1, 2013.  Many employers are still assessing their options with regards to maintaining employer sponsored coverage or dropping coverage altogether.  Regardless of whether or not you offer coverage, your employees will have the option of purchasing health insurance coverage through the exchanges.

Whether you plan to continue to offer coverage, drop coverage, or have never offered coverage at all, your organization may still be subject to the requirement to notify your employees of the availability of the health insurance exchanges.  Generally speaking, employers who are subject to the Fair Labor Standards Act (annual sales of $500,000 or more) must provide a written notice to their employees containing certain minimum information, including:

1. Notice of exchange availability.
2. How to contact the exchange for additional information.
3. The fact that the employee could potentially be eligible for a premium assistance tax credit if certain factors are met.
4. Notice that the employee may lose the employer contribution towards coverage (if offered) if they elect to opt out of the employer sponsored plan in favor of the exchange.

Sound complicated?  The good news is the Department of Labor has developed two model notices that can be utilized by employers.  One model is for those planning to offer coverage and the second model is for those that will not offer a health plan to their employees.  We encourage you to visit http://www.dol.gov/ebsa/healthreform/ to obtain more information on the model notices.

Please contact your YHB service representative for more information on the health insurance exchanges as well as other provisions of the Affordable Care Act that may impact your organization.