September 3, 2013
Re: Required Notice to All Employees Under the Affordable Care Act
The Affordable Health Care Act (ACA) requires that all employers provide a notice to all employees, regardless of their health benefit eligibility, of their health insurance options. In the temporary guidance issued on this requirement, the Federal Department of Labor has stated that employers are expected to distribute the New Health Insurance Marketplace Coverage Options and Your Health Coverage notice to your employees in the late summer or fall of 2013. A sample notice, which you can fill-in, is available at www.dol.gov/ebsa/pdf/FLSAwithplans.pdf.
Employers will need to provide the following information on the sample notice:
- List of the main contact person for health benefits coverage information at your location where indicated. NJ Division of Pensions and Benefits has suggested that in most cases this should be the Certifying Officer responsible for signing off on health benefits applications. (on page 1)
- List the employer’s name, employer identification number (EIN), employer address and phone number. List the main contact person for health benefits information again, including phone number and e-mail address. (on page 2)
- Employers must indicate whether coverage is offered to all employees or some employees. If you offer health benefits for some employees you must indicate the required weekly hours of service at your location to be eligible for coverage. Please note, for those covered under the State Health Benefits Plan (SHBP), employees must work a minimum of 25 hours per week to be eligible for coverage, however, a municipality can require an employee to work more than 25 hours per week to be eligible for coverage.
- Employers must indicate whether coverage is offered to eligible dependents and if so, list the eligible dependents. Please note, for those covered under SHBP, they should check off “we do offer coverage” and list spouses, civil union partners and children. If you offer coverage to same-sex domestic partners per P.L. 2003, c. 246, include domestic partners in that space as well.
- Check the last box only if the health benefit coverage meets the minimum value standard and the cost of this coverage is intended to be affordable, based on the employee wages. The “minimum value standard” requires that employers offer a health plan that covers a minimum of 60% of its members incurred health care costs. A plan is considered affordable if the cost for the least expensive available plan, at single coverage, is less than 9.5% of the gross wages on the employee’s year end W-2. Please note, for those covered under SHBP, they should check this box. Division of Pensions and Benefits has determined that all plans offered by the SHBP exceed the minimum value standards as well as any employee paying a health insurance contribution based on P.L. 2011, c. 78 would meet the standard of eligibility for “affordable” coverage. This is true, under SHBP, for all four phase-in years of Chapter 78 and for all salary bands. If an employer has an agreement in place in which employees’ contribution to their health insurance premium is more than required by Chapter 78 the employer will need to verify that the employee’s share of the cost for single coverage in the least expensive SHBP is not more than 9.5% of the employee’s salary before checking the box.
It is optional for employers to complete page 3 of the model notice.
This notice must be distributed to ALL employees, regardless of full-time or part-time status and regardless of their eligibility for coverage for health benefits. Employers must complete and distribute these forms to their current employees no later than September 15, 2013. Any new employees hired after September 15, 2013 should receive a copy of the Notice when they begin employment.
Beginning in 2014, the ACA will provide an option for individuals to purchase private health insurance coverage through Health Insurance Marketplace, a new health insurance market that is commonly referred to as the “State Exchange”. Health Insurance Marketplace offers “one-stop shopping” to find and compare private health insurance opinions. Open enrollment for health insurance coverage through the Marketplace begins October 2013 for coverage starting as early as January 1, 2014. For more information of the New Health Insurance Marketplace Coverage Options and Your Health Coverage under the Fair Labor Standards Act please visit www.dol.gov/ebsa/newsroom/tr13-02.html.
In addition, we will be offering a seminar “Understanding the Affordable Healthcare Act” on Monday, October 21, 2013 at the PNC Arts Center in Holmdel. For more information or to register please visit www.njslom.org/seminar-documents/2013-Oct21-Healthcare.html.
We will continue to provide you information on the ACA as it becomes available.
Very truly yours,
William G. Dressel, Jr.