Deadline For Employers To Communicate The Availability Of State Health Insurance Exchanges Approaching

Employers are required to notify employees about the availability of state health insurance exchanges by March 1. According to Jennifer Benz, chief executive officer of Benz Communications, a HR and benefits communication strategy firm, “While the DOL hasn’t yet released proposed regulations, the information required in the notice is going to be complicated for employers of all sizes. No matter what deadline the DOL ultimately sets, employers need to be prepared to include this in their communication plans for 2013.”

Specifically, employers are required to communicate three items of information. Those three items are:

1. State exchange basics. A description of the state exchange, what services the exchange provides, and how to contact the exchange (website and customer service number). However, not all states have decided how they are going to comply, and employers in states that chose the multi-plan option will have an even more challenging time, Benz noted.

2. Individual plan value. Employers are required to let employees know whether they will receive at least 60 percent coverage of essential health benefits through their employer plan and whether an employee might be eligible for a premium tax credit if they purchase a plan on the state exchange.

3. Tax implications. If an employee purchases a health plan through an exchange, the money an employer contributes toward insurance goes away, Benz noted. Because the money an individual spent on employer-sponsored coverage is not taxed, buying coverage through the state exchange may change the individual’s tax obligation. “And then employers will then not be able to deduct this coverage as a business expense,” Benz commented.

While the particulars of the state exchanges are still unknown, Benz is hopeful there will be a simple, streamlined way to communicate the new exchanges (one online resource, for example, is versus a requirement to provide details based on the state an individual employee lives in. This will be critical for companies with employees across the country.

“Communicate your 2014 position before the legalese does. Once you figure out your strategy on plan design and how to comply with the 2014 provisions, you need to create a strategic communication plan to bring employees along. Be sure to use language that fits the notice into your big picture approach to health care reform compliance. For many employers, this strategy is going to include high-deductible health plans and incentive-heavy wellness programs, two benefit strategies that require robust thoughtful communications in their own right,” Benz concluded.

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