HealthMarketplaceUnder the Afford­able Care Act (ACA), each Health Insur­ance Exchange (Mar­ket­place) must noti­fy employ­ers when they have an employ­ee who has received a gov­ern­ment sub­sidy to enroll in a health plan through the Mar­ket­place. These notices will begin being sent to employ­ers in the com­ing weeks and months, either indi­vid­u­al­ly or in batch­es. Because the notice pro­ce­dure is being phased in, you may or may not receive notices, even if you have employ­ees who received sub­si­dies through a Mar­ket­place. Here’s what you need to know.

Reason for Notice

These notices, also called 1411 Cer­ti­fi­ca­tions in ref­er­ence to the per­ti­nent sec­tion of the ACA, will be sent to employ­ers as part of the government’s ver­i­fi­ca­tion efforts regard­ing per­sons who received Mar­ket­place sub­si­dies for indi­vid­ual health insur­ance. Mar­ket­places want to con­firm whether the indi­vid­ual was eli­gi­ble for, or enrolled in, an employer’s health plan since those facts can affect someone’s eli­gi­bil­i­ty for subsidies.

You may receive a notice (sim­i­lar to the sam­ple found here) for each employ­ee that received a sub­sidy to enroll in insur­ance through a Mar­ket­place. The notice only informs you that the employ­ee was grant­ed a sub­sidy — it is not a noti­fi­ca­tion that you have been assessed any penal­ty. Under the ACA’s play or pay rules, penal­ties may be assessed lat­er by the Inter­nal Rev­enue Ser­vice to applic­a­ble large employ­ers for fail­ing to offer full-time employ­ees afford­able min­i­mum val­ue cov­er­age; how­ev­er, play or pay penal­ties, and notice of them, are a sep­a­rate process entirely.

What You Should Do

  • Even if you do not believe that any of your employ­ees obtained indi­vid­ual cov­er­age through a Mar­ket­place, be on the look­out for these notices because you have 90 days from the date of the notice to file an appeal, if nec­es­sary. Notices may go to a sub­sidiary instead of the par­ent com­pa­ny or to a par­tic­u­lar work­site instead of the employer’s main office, depend­ing on the infor­ma­tion the employ­ee pro­vid­ed to the Mar­ket­place. Alert all depart­ments and work­sites to watch for mail in envelops from a gov­ern­ment agency or insur­ance Marketplace.
  • Important:Keep these notices con­fi­den­tial because employ­ers are pro­hib­it­ed by law from dis­crim­i­nat­ing or retal­i­at­ing against employ­ees who may receive sub­si­dies. Con­sid­er seg­re­gat­ing func­tions so staff involved in review­ing notices is sep­a­rate from staff involved in employ­ment or ben­e­fit plan decisions.
  • Estab­lish your audit process for review­ing any notices you may receive and for fil­ing appeals when appro­pri­ate. Con­firm that the infor­ma­tion is cor­rect based on your employ­ment and pay­roll records. If you are an applic­a­ble large employ­er sub­ject to the ACA’s play or pay rules, you also should check if the employ­ee was a full-time employ­ee and, if so, whether you had offered afford­able min­i­mum val­ue cov­er­age to the employ­ee. Read more about the notice and appeal process here.
  • File an appeal with­in 90 days of receipt of the notice if any of the infor­ma­tion is incor­rect. To do this, be sure to retain the notice and fol­low the direc­tions for appeal. Remem­ber that these notices will not advise you of any penal­ties on large employ­ers, so appeals at this stage are to cor­rect any mis­takes in employ­ment infor­ma­tion. In addition: 
    • If you are a small employ­er and not sub­ject to the ACA play or pay rules, you are not impact­ed direct­ly but your appeal may alert the Mar­ket­place that the indi­vid­ual was enrolled in your group health plan and not eli­gi­ble for subsidies.
    • If you are an applic­a­ble large employ­er who is sub­ject to the ACA’s play or pay rules, you should be proac­tive in appeal­ing the Marketplace’s sub­sidy deter­mi­na­tion if any infor­ma­tion is incor­rect. (An applic­a­ble large employ­er gen­er­al­ly is one that employed an aver­age of 50 or more full-time and full-time-equiv­a­lent employ­ees in the pri­or cal­en­dar year. Relat­ed employ­ers in a con­trolled group are count­ed togeth­er.) Although Mar­ket­places can­not access play or pay penal­ties, your appeal may help estab­lish the facts and head off lat­er penal­ty action by the IRS.

Read more here…