The Department of Labor has postponed the deadline by which employers were to inform workers about their state health exchanges.The March 1, 2013 deadline has been extended until the DOL releases more guidance on the requirements. Many states have struggled to establish the exchanges, with some objecting for political reasons and others due to fears over hidden costs. States can create or run their own exchanges or partner with the federal government. Those states that refuse will have an exchange imposed on them by the federal government. The Notice must:
- Inform employees of the existence of the exchanges, describe the services they provide, and the manner in which the employee may contact the exchanges to request assistance;
- Inform employees that they may be eligible for a premium tax credit or for cost-sharing reductions if the employer’s plan provides less than 60% actuarial value and they purchase coverage through an exchange;
- Inform employees that, if they purchase coverage through an exchange, they may lose the employer contribution (if any) to any health plan sponsored by the employer, and that unlike exchange coverage, which is purchased with after-tax dollars, all or a portion of the employer contribution towards coverage under its own plan, if received, would be excludable from the employee’s income for Federal income tax purposes.
The DOL delayed the effective date of this requirement to a date at some point in the near future, likely during the late summer or early fall of 2013. The delay serves two purposes: it will allow the DOL more time to develop a model notice, and it will align the effective ddate with the first open enrollment period for the Exchanges.
Visit the DOL FAQ page for additional information on this topic.