New enforcement date set for “Employee Exchange Notice”

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The Department of Labor (DOL) has reinstated the “Employee Exchange Notice” requirement and announced a new enforcement date of October 1, 2013. On May 8, 2013 the DOL released temporary model employee communications and guidance that employers can use to inform employees about the Exchanges available 1/1/14.   The guidance and model notices can be found at http://www.dol.gov/ebsa/newsroom/tr13-02.html.  Employers may use the model notices or create their own notice, provided it:

  • Is provided to all employees by 10/1/13 (all full time and part-time employees regardless of whether they are enrolled in an employer sponsored health plan)
  • Describes what Exchanges are and the services they will offer
  • Informs employees about the potential availability of subsidies to assist in paying for coverage purchased through an Exchange
  • Explains that purchasing coverage on an Exchange a) could cause them to lose any employer contribution for employer sponsored coverage and b) the purchase would be made with after-tax dollars
  • Is understandable by the average employee
  • Is provided by first class mail or electronically if DOL electronic safe harbor disclosure requirements are met
  • Is integrated into COBRA election notices

Please note that a) the Exchange in California is called Covered California and b) the Department of Health and Human Services (HHS) now refers to the Exchange as “The Health Insurance Marketplace”.

Keenan has written a more detailed brief that can be found at: //www.keenan.com/news/brief/2013/BRF_20130513_ModelNoticeofExhange_KA.pdf