On June 21, 2016, the Department of Health and Human Services (HHS) issued 500,000 notices to employers across the country, informing them of employees who enrolled in health coverage through the state health exchange. The notices may well be a precursor to substantial penalties under the Affordable Care Act, and we can expect the HHS to issue more notices in the coming months and years.
If you received a notice, consider it an early warning of potential penalties under the ACA: large employers (meaning you had an average of 50 or more full-time and full-time equivalent employees last year) must offer their full-time employees the opportunity to enroll in an affordable, employer-sponsored health plan. Failure to do so may result in a penalty of up to $3,240 per employee – but only if at least one employee enrolled in coverage through the state health exchange, and received a premium tax credit to help pay for that coverage. This notice, then, is a warning that one of your employees did exactly that. A sample employer notice has been released.
Fortunately, you may appeal the notice by showing that you did offer your employee the opportunity to enroll in an affordable health plan that provides minimum value, and hopefully remove the potential for any penalty under ACA. Employers have 90 days to appeal the notice, beginning on the date the notice was issued-so, if you received one of the notices issued on June 21, 2016, your appeal is due September 19, 2016. Instruction on how an employer may appeal are here.
The Centers for Medicare & Medicaid Services (CMS) released a Frequently Asked Questions document last fall that you may find helpful.