News & Events


There have been many updates surrounding the Affordable Care Act ("ACA") with regards to guidance for employers. Most recently, is a written notice (the "Notice") that the ACA requires of many employers. The Notice must be provided by October 1, 2013 to all of the employer's current employees (whether full-time or part-time) and is intended to inform them of the health insurance coverage options available in the new Health Insurance Marketplace mandated by ACA. The following Q&A further explains the Notice:

Q: Which employers are required to distribute the Notice?

A: In general, all employers which are engaged in interstate commerce and whose gross annual revenue equals or exceeds $500,000 must provide this Notice. It should be noted that most hospitals, schools and government agencies are also required to distribute the Notice regardless of the amount of their annual revenue.

Q: When must the Notice be sent?

A: The Notice must be sent by October 1, 2013 to all current employees. For employees hired after October 1, 2013, the Notice must be sent within 14 days of hiring.

Q: How should employers send the Notice?

A: The Notice should be distributed either by first class mail or by email if an employee has ready access to an individual email account and certain safeguards are met consistent with Department of Labor ("DOL") regulations.

Q: Has the DOL provided a Model Notice that can be used to satisfy an employer's obligation to provide the Notice?

A: Yes. The DOL has provided a Model Notice for employers which do not offer a health plan for its employees and another Model Notice for employers which do offer a health plan to some or all of its employees. These two Model Notices can be found on the Department of Labor website or by clicking FLSA without plans or FLSA with plans.

Q: Are employers required to use the Model Notice?

A: No. An employer is free to draft its own Notice as long as the Notice provides the following information:

1. Describes the existence and intended operation of the new Health Care Marketplace (referred to in ACA as the "Exchange") being created as of October 1, 2013, and how the employee can contact the Exchange;

2. Informs the employee that, depending on an employee's income and whether the employer plan's share of the total allowed costs of benefits provided under the plan is less than 60% of such costs, that the employee may be eligible for a premium tax credit under the Internal Revenue Code to assist the employee in purchasing health insurance coverage from the Exchange; and

3. Explains that if the employee purchases health insurance coverage through the Exchange, the employee may lose coverage under his employer's health plan as well as the ability of having the employer's share of the cost of the coverage treated as non-taxable to the employee.

For additional information regarding this topic, please contact your local UHY LLP professional.