In preparation for the January 2014 start up of the Affordable Care Act’s (ACA) health insurance Exchanges, employers must meet the October 1 deadline to provide notice to employees (full and part-time) about the Exchanges and their potential eligibility for premium tax credits. New employees hired after October 1 must be given this notice within 14 days of their start date. Guidance released by the Department of Labor (DOL) can be found here.
The requirement to provide notice applies to employers covered by the Federal Labor Standard Act (FLSA). In general, this means employers with one or more employee who have a volume of $500,000 of annual business. DOL guidance relating to the applicability of the FLSA can be found here.
Employers must notify workers about premium tax credits and eligibility requirements for the Exchange. An employee whose employer-provided insurance costs exceed 9.5 percent of their income are eligible for premium assistance and to enter the Exchange. To determine if an employee’s share of coverage exceeds 9.5 percent of income, a comparison is made between an employee’s W-2 Box 1 income and the employee contribution amount for the lowest cost for a self-only health insurance plan offered by an employer.
The notice for employers offering healthcare coverage can be found here.
The notice for employers without a healthcare plan can be found at here.
The ACA assesses applicable large employers (more than 50 full time employees or their equivalent) who offer coverage but have at least one full-time employee receiving a premium tax credit the lesser of $3,000 for each employee receiving a premium credit or $2,000 for each full-time employee. The ACA assesses applicable large employers that do not offer coverage and have at least one full-time employee who receives a premium tax credit a fee of $2,000 per full-time employee, excluding the first 30 employees from the assessment.
Farm Bureau created documents explain how to determine if an employer is an applicable large employer. You can find them here: