Be Prepared For Fall Open Enrollment Changes
Originally posted September 3, 2013 by Amy Gallagher on https://www.golocalworcester.com
The healthcare reform law requires employers to notify employees of available health exchange options by October 1. That means employees will face new health plan choices - and decisions - during open enrollment this year.
Education is Key
With new options comes the need for more education. And that doesn't just mean the health exchange option notice employers are required to provide, which is likely to confuse employees.
Since employees will get to choose between employer-sponsored plans or those offered by the exchanges for the first time, employers should make an extra effort with their communication plans for this fall's open enrollment. And employees should step up their participation in the process as well.
Employee questions...and answers
Employers should provide informative, detailed materials that will enable employees to evaluate their choices and make the best decisions. When reviewing open enrollment resources, employees should follow these five steps:
1. Review the benefits and costs of the employer-sponsored plan. Understand what the employee’s share of the cost is in dollars - an amount that's deducted pre-tax from your paycheck at whatever tax bracket you fall in. For example, an employee who pays $250 monthly of a $500 total monthly individual plan cost will have a deduction (assuming a 30% tax bracket) around $175 monthly.
2. Compare the employee costs above to an individual plan offered through a state-run exchange.Employees who are Rhode Island residents may visit www.HealthSourceRI.com and those who reside in Massachusetts can go to www.mahealthconnector.com for details. Keep in mind that employees who purchase an individual plan through the exchange must pay the full cost of the plan unless you qualify for tax credits to offset, or eliminate, the cost.
3. Determine tax credit by using an online tool and estimating family income for 2014 (before taxes), telling the age of the oldest adult in the family, and entering the total number of adults and children in the household. Generally, employees may be able to get a subsidy if they are single and make up to $45,960, or are a family of four and earn up to $94,200. The exact amount of the subsidy is determed by size of family and level of income, so the less someone makes, the more they will receive.
4. Employees who receive the subsidy should subtract the earned tax credits from the total cost of the exchange plan to determine their total premium cost. Then compare this amount to what you would pay for an employer-sponsored plan.
5. Last, all employees must understand that, starting January 1, 2014, they are mandated to be insured.Whether through an employer or exchange plan, it’s up to you to get coverage, or pay penalties at tax time.
Does out-of-pocket delay actually apply to you?
Originally posted September 3, 2013 by Tristan Lejeune on https://ebn.benefitnews.com
Yet another Affordable Care Act delay is in the spotlight: limits on out-of-pocket spending.
According to the law, starting in 2014, health plan participants will be spending no more than $6,350 in total out-of-pocket costs for individuals and $12,700 for family plans. That cap on out-of-pocket spending has been delayed until 2015, however, if an employer is using two separate vendors for its medical and pharmacy benefits. Sandy Ageloff, southwest health & group benefits leader for Towers Watson, says the rule only applies “to nongrandfathered plans” and emphasizes that the delay only applies to those who split their services.
“So the biggest piece of the legislation,” Ageloff says, “is that compliance is still required for Jan. 1, 2014 if the benefit plan – whether it’s a self-funded employer plan or a fully insured carrier program – is using a single vendor for the administration of both medical and pharmacy. The nuance comes in when you have multiple vendors, you get a one-year deferral in total compliance. You still have to comply in pieces, but you don’t have to comply in total.”
The number of plans that maintain their grandfathered status in the face of ACA continues to shrink, but Ageloff estimates that 35% or 40% of large employers use different vendors and thus have the extra year. Complicating things, she says, is that “a number of carriers actually have, behind the scenes, carved out that relationship with a pharmacy vendor,” so two can masquerade as one. Figuring out compliance may require more than just a phone call to your provider.
“For example, if you look at Anthem Blue Cross Blue Shield, they have a subcontracted relationship with ESI to manage their pharmacy benefits,” Ageloff says. “Same is true of a lot of other broad-based medical insurance carriers. So the health plans themselves are taking different interpretations on whether the full mandate for 2014 applies to them, or if they get the deferral. So that’s complicating this. As an employer, if I say, I use Anthem BCBS as either my [third-party administrator] or I’m buying an insured product from them, I’m relying on them to tell me how they interpret their own program. So that’s creating some challenges, particularly for self-funded employers who control their own plan design.”
The National Business Group on Health Vice President of Public Policy Steve Wojcik says, like the employer mandate delay, the out-of-pocket postponement was done to allow systems to catch up to what is required of them in terms of processing and accounting. And, like the employer mandate delay, he says it’s good news.
“It means that employers and their plans have another year to consolidate and coordinate,” Wojcik says. “In many cases the issue is that the PBM handles the pharmacy benefit separately and the medical expenses are handled through the health plan, so a lot of times their systems don’t talk with one another, and then the patient or plan member doesn’t have up-to-the-minute information on where they stand toward their out-of-pocket limit.”
Wojcik says “by and large, most people don’t approach their out-of-pocket limits in a year, so for most people, it’s not going to affect them.” For those who do – usually those with chronic conditions or highly expensive pharmacy needs or both – “it will just be another year before they get relief.”
All Legal Same-Sex Marriages Will Be Recognized for Federal Tax Purposes
Originally published on https://www.treasury.gov
Ruling Provides Certainty, Benefits and Protections Under Federal Tax Law for Same-Sex Married Couples
WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service (IRS) today ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. The ruling applies regardless of whether the couple lives in a jurisdiction that recognizes same-sex marriage or a jurisdiction that does not recognize same-sex marriage.
The ruling implements federal tax aspects of the June 26th Supreme Court decision invalidating a key provision of the 1996 Defense of Marriage Act.
“Today’s ruling provides certainty and clear, coherent tax filing guidance for all legally married same-sex couples nationwide. It provides access to benefits, responsibilities and protections under federal tax law that all Americans deserve,” said Secretary Jacob J. Lew. “This ruling also assures legally married same-sex couples that they can move freely throughout the country knowing that their federal filing status will not change.”
Under the ruling, same sex couples will be treated as married for all federal tax purposes, including income and gift and estate taxes. The ruling applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA, and claiming the earned income tax credit or child tax credit.
Any same-sex marriage legally entered into in one of the 50 states, the District of Columbia, a U.S. territory, or a foreign country will be covered by the ruling. However, the ruling does not apply to registered domestic partnerships, civil unions, or similar formal relationships recognized under state law.
Legally-married same-sex couples generally must file their 2013 federal income tax return using either the “married filing jointly” or “married filing separately” filing status.
Individuals who were in same-sex marriages may, but are not required to, file original or amended returns choosing to be treated as married for federal tax purposes for one or more prior tax years still open under the statute of limitations.
Generally, the statute of limitations for filing a refund claim is three years from the date the return was filed or two years from the date the tax was paid, whichever is later. As a result, refund claims can still be filed for tax years 2010, 2011, and 2012. Some taxpayers may have special circumstances (such as signing an agreement with the IRS to keep the statute of limitations open) that permit them to file refund claims for tax years 2009 and earlier.
Additionally, employees who purchased same-sex spouse health insurance coverage from their employers on an after-tax basis may treat the amounts paid for that coverage as pre-tax and excludable from income.
How to File a Claim for Refund
Taxpayers who wish to file a refund claim for income taxes should use Form 1040X, Amended U.S. Individual Income Tax Return.
Taxpayers who wish to file a refund claim for gift or estate taxes should file Form 843, Claim for Refund and Request for Abatement.
For information on filing an amended return, go to Tax Topic 308, Amended Returns athttps://www.irs.gov/taxtopics/tc308.html or the Instructions to Forms 1040X and 843. Information on where to file your amended returns is available in the instructions to the form.
Future Guidance
Treasury and the IRS intend to issue streamlined procedures for employers who wish to file refund claims for payroll taxes paid on previously-taxed health insurance and fringe benefits provided to same-sex spouses. Treasury and IRS also intend to issue further guidance on cafeteria plans and on how qualified retirement plans and other tax-favored arrangements should treat same-sex spouses for periods before the effective date of this Revenue Ruling.
Other agencies may provide guidance on other federal programs that they administer that are affected by the Code.
For Revenue Ruling 2013-17, click here.
For Frequently Asked Questions, click here.
For registered domestic partners who live in community property states, click here for Publication 555, Community Property.
Treasury and the IRS will begin applying the terms of Revenue Ruling 2013-17 on September 16, 2013, but taxpayers who wish to rely on the terms of the Revenue Ruling for earlier periods may choose to do so (as long as the statute of limitations for the earlier period has not expired).
IRS Recognizes All Same-Sex Marriages for Pretax Benefits
Originally posted by Stephen Miller on https://www.shrm.org
Under a new Internal Revenue Service ruling, employees who pay for employer-provided health insurance for their same-sex spouse may treat these costs as excludable from federal income taxes, even if they live in a state that doesn't recognize their marriage. State income taxes are another matter, however.
The U.S. Department of the Treasury and the IRS ruled on Aug. 29, 2013, that same-sex couples who were legally married will be treated as married for federal tax purposes, including the pretax treatment of a spouse's health insurance coverage, in all 50 states and the District of Columbia. Revenue Ruling 2013-17 applies, in other words, regardless of whether the couple now live in a state that recognizes same-sex marriage or a state that does not recognize same-sex marriage.
The ruling implements federal tax aspects of the Supreme Court's June 26 decision in United States v. Windsor, which invalidated a key provision of the 1996 Defense of Marriage Act.
Revenue Ruling 2013-17 applies to all federal tax provisions in which marriage is a factor, including filing status, claiming personal and dependency exemptions, employee benefits, and claiming the earned income tax credit or child tax credit.
The ruling covers same-sex marriages entered into in one of the U.S. jurisdictions where such marriages are recognized as legally valid (sometimes referred to as the "state of celebration," as opposed to a couple's state of residency), as well as legal marriages performed in a foreign country. However, the ruling does not apply to registered domestic partnerships, civil unions or similar formal relationships recognized under state law.
Employee Benefits Affected
Under the ruling, same-sex couples will be treated as married for all federal tax purposes. Those who purchased same-sex spouse health insurance coverage from their employer on an after-tax basis may treat the costs of that coverage as pretax and excludable from income (for federal income tax purposes; state income taxes may still apply).
"Same-sex spouses legally married anywhere no longer are taxed on health benefits coverage for their spouses and can pay premiums pretax, even if they live in a non-recognition state such as Florida, Texas, etc. This is a huge development and a relief for these employers and employees," Todd Solomon,a partner in the employee benefits practice group of McDermott Will & Emery LLP in Chicago, told SHRM Online.
"However, state taxation of benefits may continue to be quite complex, although it remains to be seen how states will treat this," Solomon added. "On the flip side, the guidance may not be welcome for employers who currently do not offer same-sex partner benefits because now they are legally required to offer benefits to same-sex spouses in all states" (see box below).
Treasury and the IRS intend to issue streamlined procedures for employers who wish to file refund claims for payroll taxes paid on previously taxed health insurance and other benefits provided to same-sex spouses. Treasury and IRS also intend to issue further guidance on cafeteria plans and on how qualified retirement plans and other tax-favored arrangements should treat same-sex spouses for periods before the effective date of Revenue Ruling 2013-17.
Other agencies may provide guidance on federal programs they run that are affected by the Internal Revenue Code, Treasury said.
Are Employers Obligated to Provide Equal Treatment?
Are employers located in states that do not recognize same-sex marriage now required to grant access to health care benefits to the spouses of employees in legal same-sex marriages (entered into elsewhere), if they grant health benefits to spouses in opposite-sex marriages?
"This is an open question, and only time and legal challenges—which there are certain to be—will tell," commented Todd Solomon of McDermott Will & Emery LLP.
Employers are not "required" to offer medical plan coverage to same-sex spouses the way they are required to offer a qualified joint and survivor annuity (QJSA) and a qualified preretirement survivor annuity (QPSA) in a pension plan because there are no similar statutory benefit mandates in the welfare plan context, Solomon explained. However, "employers that do not cover same-sex spouses will be very vulnerable to discrimination claims, in particular sex discrimination under Title VII. State and local discrimination claims are also possible, but private sector employers can likely argue that these claims are preempted by ERISA. But ERISA does not preempt Title VII."
While Title VII does not protect against sexual orientation discrimination, Solomon pointed out that guidance from the Equal Employment Opportunity Commission suggests that it might interpret this type of exclusion of same-sex spouses as sex discrimination, and therefore "an employer denying coverage to a same-sex spouse will be at risk for having to defend a costly sex discrimination lawsuit."
Retroactive Application and Refund Claims
The IRS set a prospective effective date for the ruling of Sept. 16, 2013. Legally married same-sex couples must file their 2013 federal income tax return using either the “married filing jointly” or “married filing separately” filing status.
For prior tax years still open under the statute of limitations, individuals who were in same-sex marriages may opt to file original or amended returns choosing to be treated as married for federal tax purposes. Generally, the statute of limitations for filing a refund claim is three years from the date the return was filed or two years from the date the tax was paid, whichever is later. As a result, refund claims can still be filed for tax years 2010, 2011, and 2012. Some taxpayers may have special circumstances (such as signing an agreement with the IRS to keep the statute of limitations open) that permit them to file refund claims for tax years 2009 and earlier.
With respect to retroactivity for prior years, "employers are still in wait-and-see mode until the IRS issues further guidance," said Solomon. "What we know is that employees and employers have the right—but not the obligation—to file for refund claims on past taxes paid on same-sex spouse benefits in open tax years—typically 2010, 2011, and 2012."
"Employers can expect to get requests from employees for corrected Form W-2s from these prior years," Solomon noted. "But what is not clear yet is how to handle cafeteria plan participation and tax reporting for prior years and whether adjustments need to be made. The IRS will be issuing more guidance on this issue as well as the retroactive impact of the guidance on retirement benefits that have or in many cases have not been paid to same-sex spouses."
Along with Revenue Ruling 2013-17, the IRS released two related sets of frequently asked questions and answers:
- Answers to Frequently Asked Questions for Individuals of the Same Sex Who Are Married Under State Law.
- Answers to Frequently Asked Questions for Registered Domestic Partners and Individuals in Civil Unions.
The IRS ruling "assures legally married same-sex couples that they can move freely throughout the country knowing that their federal filing status will not change,” Treasury Secretary Jacob J. Lew noted in a released statement.
3 obstacles on the road to retirement readiness
Originally posted August 28, 2013 by Robert C. Lawton on https://ebn.benefitnews.com
Participants can be their own worst enemies. Shlomo Benartzi, a leading authority on behavioral finance, has identified the following three obstacles that plan sponsors need to overcome to propel participants successfully down the road to retirement readiness:
1. Inertia
Plan sponsors are probably most familiar with employee inertia. The incorporation of "auto" features — auto-enrollment, auto-escalation and auto re-enrollment — into 401(k) plans, along with the addition of professionally managed investment options like target-date funds, can successfully address employee inertia. Vanguard and The Newport Group report that approximately one-third of the 401(k) plans they administer have auto features. Experts believe that within three to five years the majority of 401(k) plans will adopt these plan design elements.
2. Loss aversion
Loss aversion may be characterized as valuing the avoidance of loss over the accrual of gains. In other words, participants are more afraid of losing money than they are of not having enough money (as a result of investing too conservatively). In order to overcome this obstacle plan sponsors need to offer target-date funds. Most experts believe that 75% to 85% of all plan participants should be invested in target-date funds. When left on their own, participants tend to invest too conservatively to keep pace with inflation, or they are prone to attempt to market time, resulting in significant losses.
Model or lifestyle portfolios aren't a solution here since employee inertia comes into play. Both of these types of professionally managed investment options require a positive employee election to move to more conservative options over time. Target-date funds do not require any employee interaction since the investment manager adjusts the risk level of the portfolio as time goes by.
3. Myopia
Myopia is the hardest factor to overcome. Participants have a tendency to focus on immediate, short-term goals rather than planning for their future. Many participants view the process of saving as difficult and not worthwhile. For example, they may feel that they will be too old to ever enjoy their savings, or they may believe they will pass away before they are able to retire. Regardless of the reason, participants are not eager to fund a future they have a difficult time envisioning. Employee education is the only effective tool to fight myopia.
Plan sponsors who adopt these plan design, investment and employee education elements have a much better chance of seeing their participants achieve retirement readiness.
FMLA extended to same-sex couples
Originally published August 30, 2013 by Elisabeth Blattner-Thompson, Diane A. Thompson, Brian D. Pedrow and Mary Cate Gordon on https://ebn.benefitnews.com
The U.S. Department of Labor on Aug. 9 issued a revised fact sheet to provide guidance on Family and Medical Leave Act protections for same-sex couples. The guidance follows the U.S. Supreme Court’s decision in United States v. Windsor, which struck down Section 3 of the Defense of Marriage Act and fundamentally changed how the federal government treats same-sex marriages.
According to The Wall Street Journal, which quoted an internal memorandum from Labor Secretary Thomas Perez, the extension of FMLA coverage is but one of many steps that the agency will take to properly implement the Windsor decision. On the same day, the Social Security Administration announced that it will now process and pay out spousal retirement claims for same-sex spouses.
Under the revised DOL fact sheet, a "spouse" means a "husband or wife as defined or recognized under state law for purposes of marriage in the state where the employee resides, including 'common law' marriage and same-sex marriage." This definition comports with the FMLA regulations, which define "spouse" based on the legal definition of marriage in the state of the employee's residence.
The DOL's FMLA "spouse" definition does not cover situations in which an employee in a same-sex marriage resides in a state that does not recognize same-sex marriage, but was married or works in a state that does recognize such marriages. If the DOL wishes to expand the "spouse" definition, it will be unable to do so through fact sheets or interpretive guidance, but instead must act through a public notice-and-comment rulemaking process.
The fact sheet contains links to earlier DOL regulatory materials, which refer to other FMLA leave benefits available to same-sex couples. For example, under a 2010 administrator's interpretation, an employee may take FMLA leave for a child being raised with a same-sex partner, regardless of whether the same-sex relationship is legally recognized, to bond with the new child or to care for a child with a serious health condition. In another example, an employee who was raised by same-sex parents may take leave to care for a non-adoptive or non-biological parent on the basis of an in loco parentis relationship. In both cases, the right to take leave arises from the in loco parentis relationship, not from the existence of a legally valid same-sex marriage.
How to Take Control of Your 401(k)
Originally posted August 27, 2013 by Scott Holsopple on https://money.usnews.com
A recent survey by Charles Schwab of 1,000 401(k) participants said that 52 percent of those polled find their 401(k) plan more confusing than their health insurance benefits. That's pretty impressive, given that I don't think I know anyone who claims to understand their medical coverage. Fifty-seven percent desired an easier way to choose their 401(k) investments.
Despite the bad press the 401(k) plan sometimes receives for its complexity and for requiring plan participants to become investors whether they want to or not, the fact remains that it is a great way to save for retirement. For many people, it's their only retirement savings vehicle. Sure, if you don't have much interest in investing and finance, you might find it confusing to manage your account — but it's up to you to do something about it.
Being a 401(k) plan participant requires you to take charge of your retirement saving and investing, so don't let confusion or uncertainties leave you on the sideline. Instead, here are five things you can do to step up:
- Embrace the power and control you have, and think hard about how to use it. Spend some time seriously thinking about your retirement saving and investing needs. Jump on some educational websites and do some reading to familiarize yourself with basic investing terminology and the types of investments to which you have access.
- Take action by creating a retirement saving and investing plan. Outline the amount you plan to contribute now and in the future in order to reach your retirement goals.
- Take advantage of your 401(k) plan's features. Many plans offer ways to maximize your participation such as an employer match, educational resources and advisory services that can help you pick the right funds to support your retirement goals.
- Check to see if your plan offers an auto-increase contribution feature, which automatically increases your contribution rate by a small amount each year (or more frequently, if you like). If your plan doesn't offer auto-increase set up calendar reminders and increase your contributions yourself. Either way, you need to save as much as you can and regular contribution increases can help you get there.
- Once you've established your strategy, stick to it. Paying too much attention to market fluctuations can cause some investors to run scared. A long-term view is what's needed, rather than concentrating on your account balance on any one day.
The 401(k) plan might not be perfect, but you stand to gain a lot when you take advantage of being in the driver's seat — just a little know-how can make a big difference when it comes to your 401(k) and financial future.
PPACA expected to aggravate job absences
Originally posted August 23, 2013 by Dan Cook on https://www.benefitspro.com
Under pressure to meet the basic requirements of the Patient Protection and Affordable Care Act, employers may be overlooking the law’s implications for employees’ attendance at work.
This observation comes from a survey of employers and insurance providers sponsored by the Disability Management Employer Coalition and Pacific Resources.
The researchers polled 169 benefits policy decision-makers in large organizations and 118 senior professionals in the insurance industry involved with absence management and disability issues. It asked a series of questions designed to measure their employers’ preparedness for the act’s full implementation, including whether they had thoughtfully considered how the reforms might change employee attendance at work and issues around worker disability.
Most have not, the researchers concluded. “While organizations may be prepared for the changes to health care and health insurance, most were not thinking about the impact of PPACA on disability and absence management,” the study said.
Another major finding: both employers and insurers surveyed anticipate “increased incidence and duration of long-term absences.”
Both employers and insurers tended to believe that employee absences will be more frequent and longer. The reason? With more Americans enjoying the benefits of health coverage, there will be longer waiting periods for access to care providers. This will be exacerbated, the report said, by the dwindling numbers of primary care physicians entering the profession.
“Most respondents believe access to routine care will change – 42 percent believe that the ability of employees to see a physician for routine care in a timely manner will get worse, while only 21 percent believe it will improve,” the study reported.
But when it came to questions about the act’s influence on disability issues, there was less clarity among respondents.
“There is more uncertainty about how PPACA will impact the number of disability claims, although those who feel knowledgeable enough to predict what will happen are more likely to believe the number of claims will rise due to employees no longer fearing a loss of health care coverage from a long-term absence,” the study said.
Overall, insurers took a more pessimistic view of the ways in which Obamacare might influence attendance and disability.
“Carriers are more likely than employers to think that PPACA will have an impact on absence and disability,” the study said. “A third of employers and a majority of carriers believe PPACA will increase the incidence and duration of absences and disability. However, many have not yet considered this aspect of the law, as a quarter are not sure what will happen to absence and disability outcomes.”
Time’s running out to start a new Safe Harbor 401(k) plan for 2013
Originally posted August 26, 2013 by Jerry Kalish
Back in April, I wrote that the Retirement Plan Season Starts Now.
“Now” literally means now for an employer who wants to start a new 401(k) plan this year and take advantage of special tax rules that allow the plan to automatically pass the 401(k) discrimination tests.
Historically, many calendar year end companies have waited until late December to establish a new retirement plan. Employers have said “as long as my plan is in place by December 31, can’t my company consider the entire year for purposes of contributions and tax deductions?”
The answer to which is generally “yes” for most types of retirement plans, but there is a big exception for new Safe Harbor 401(k) plans.
October 1 is the due date for an employer to establish a new 401(k) plan using those special “Safe Harbor” contribution rules to permit owners and other Highly Compensated Employees to maximize their contributions regardless of how much the Non-Highly Compensated Employees contribute.
It works something like this. The employer can make one of two types of Safe Harbor contributions:
- 3% of compensation for all eligible employees, or
- Matching contribution of 100% of the first 3% of an employee’s contribution, and 50% of the next 2% of an employee’s contribution. Thus, if an employee contributes the full 5%, it will cost the employer 4%.
Bottom line: Owners and other Highly Compensated Employees would be able to defer the entire $17,500 maximum plus an additional $5,500 for those over age 50…and also receive the Safe Harbor contribution.
How is this possible if a plan is established on or before October 1? It’s simply that the 401(k) individual limit is a personal calendar year limit even though the 401(k) plan would have been in effect for less than the full year.
Here are the four things needed to get done on or before the October 1, deadline.
- The TPA provides a plan document.
- The employer establishes a trust account.
- The advisor helps the employer select a 401(k) provider.
- The adviser helps communicate the plan to the employees.
There is still time for an employer to establish a new 401(k) plan, and maybe even qualify for the retirement plan start-up tax credit.
This article is for general information and discussion purposes only. Employers and employees should always seek the advice of experienced tax advisors for the application of the tax rules to their specific situation.
9 tips to help employees transition to public exchanges
Originally posted on https://ebn.benefitnews.com.
According to the Obama administration, the state insurance marketplaces set up under ACA are on schedule to begin open enrollment on Oct. 1. To aid in communicating health care reform changes this fall, here are nine tips for transitioning employees into the public marketplace from Sara Taylor, health solutions development leader at Aon Hewitt.
While the model notice provided by Health and Human Services helps employers comply with provisions of the Affordable Care Act, the notice itself is likely to generate confusion and more questions from employees than it answers. Employers should supplement the model notice with additional education on the ACA and proactively answer the question, "What do I need to do with this notice?"
Explain your benefits strategy and provide context on how the public marketplaces fit within your benefits strategy.
The ACA and marketplaces may impact different employee groups in different ways. Think through the messages that impact all employees and those messages that affect only specific audiences.
What do employees need to do and by when? This information can get lost. Be sure to clearly call out specific required action steps and deadlines – both for your benefits plans and for marketplaces.
Public marketplaces are only one option for employees to obtain medical insurance. With many states expanding Medicaid eligibility, Medicaid or other public programs may be viable alternatives for some employees.
No matter how well you communicate, some employees will have questions or need additional assistance and they will likely look to you for help. Ahead of time, determine who will be handling questions, identify likely questions and have answers and others resources prepared ahead of time.
Enrolling in health benefits can be overwhelming for many individuals, and the introduction of the marketplaces adds a whole new layer of complexity. There are resources and tools available today that can help individuals understand their options, model program eligibility — including whether they may qualify for a premium tax credit (or subsidy) in a marketplace — and in some cases, enroll in a health plan.
Ensure that your leadership is aware of and on board with your benefits strategy and how the public marketplaces fit into that strategy. Encourage your HR team and managers to be advocates for your strategy to employees.
Employees that apply for financial assistance in the marketplaces need to provide information about any health insurance available to them from an employer (e.g., cost of "you only" coverage). Individuals will be instructed to ask their employers to fill out the employer information section of the form. Know how you will handle these requests. Or better yet, give employees self-service access so they can complete the application themselves.