Availability of The Healthcare Exchange

The ACA Exchanges Delays

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The ACA Exchanges Delays

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Availability of The Healthcare Exchange

Table of Contents

Earlier in the year it was announced that employers would have to inform employees of the availability of a healthcare exchange by March 1, 2013. Some of you may have noticed that the date has come and gone without exchanges being available for employers to tell employees. Here is a bit more information.

As required by the FLSA

How many of you knew that the Affordable Healthcare Act amended the Fair Labor Standards Act? Specifically:

Section 18B of the Fair Labor Standards Act (FLSA), as added by section 1512 of the Affordable Care Act, generally provides that, in accordance with regulations promulgated by the Secretary of Labor, an applicable employer must provide each employee at the time of hiring (or with respect to current employees, not later than March 1, 2013), a written notice:

  1. Informing the employee of the existence of Exchanges including a description of the services provided by the Exchanges, and the manner in which the employee may contact Exchanges 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 (the Code) if the employee purchases a qualified health plan through an Exchange; and
  3. If the employee purchases a qualified health plan through an Exchange, 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.

That was the requirement that has now come and gone. The reason it has come and gone is that the sentence “in accordance with regulations promulgated by the Secretary of Labor” allows the Department of Labor to say “never mind”. Basically no specific regulation has been issued, so there is nothing to conform to.

Coming this fall!

The issuance of the regulations regarding notification of exchanges has been delayed to the fall. This will conform to the open enrollment period for the exchanges. The DOL is working on a generic model notice that they will make available to employers. The DOL has also said they are considering

“ a compliance alternative, the Department of Labor is also considering allowing employers to satisfy the notice requirement by providing employees with information using the employer coverage template as discussed in the preamble to the Proposed Rule on Medicaid, Children’s Health Insurance Programs, and Exchanges: Essential Health Benefits in Alternative Benefit Plans, Eligibility Notices, Fair Hearing and Appeal Processes for Medicaid and Exchange Eligibility Appeals and Other Provisions Related to Eligibility and Enrollment for Exchanges, Medicaid and CHIP, and Medicaid Premiums and Cost Sharing (78 FR 4594, at 4641), which will be available for download at the Exchange web site as part of the streamlined application that will be used by the Exchange, Medicaid, and CHIP.”

(Try reading that out loud without taking a breath!)

Many of us will probably wait for the future guidance which is promised to allow flexibility and a “generous” amount of time to comply.

The small business programs have also been delayed until October 2013. The Small Business Health Options Program (SHOP) is designed to help you find health insurance that fits your small business with less hassle. We will see.

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