Marketplace Notice Forms’ ‘Expiration Date’ Isn’t Cause for Alarm

Wednesday, January 25, 2017

The U.S. Department of Labor's (DOL's) modelhealth insurance marketplace notice forms indicate that they will expire at the end of January 2017. This has caused some concern among employers over whether the forms can still be distributed after their "expiration date." The short answer is yes, if the DOL does not issue updated forms.

The Affordable Care Act (ACA) requires all employers that are subject to the Fair Labor Standards Act to provide a notice to employees about the availability of insurance through the ACA's health insurance marketplace comprised of the federal or state-run public health insurance exchanges. The notice is to be provided to existing employees annually and to new employees at the time of hire.

The DOL has two model notices to help employers comply, and the notices can be distributed either electronically or by hard copy:

Both notices indicate in the upper right corner that they expire at the end of January.

[SHRM members-only HR Q&A: What is the Health Insurance Marketplace notice requirement?]

Questions Answered

Kim Buckey, vice president of client services at DirectPath, a Birmingham, Ala.-based employee engagement and health care compliance firm, recently answered questions about the expiring marketplace notice forms.

What marketplace notice forms should an employer use after that deadline?

"There is no fine or penalty under law for failing to provide the notice," Buckey said. "So if an employer simply stopped providing the form, there would be little consequence."

She explained that the notices are models provided for employers to use, but employers are free to provide the information in another format. Here is technical guidance that explains the content of the health insurance marketplace notice, in case employers want to write their own notice. "Many employers distribute their own version or a highly condensed version of the boilerplate, sometimes as part of an annual legal notices package or brochure," she pointed out.

Will there be an updated form?

"My sources at the DOL said that there doesn't seem to be anything coming down the pipeline in terms of a renewal form," Buckey noted. "The current version was renewed from 2014, and there were no changes at that time. Given the current situation in Washington with a new administration, it's unlikely there would be a new version out by Jan. 31."

Is it OK to use the old form?

"Yes, it's safe to use the 'expiring' notice," Buckey said. "That expiration date is, apparently, an Office of Management and Budget expiration date, so it's really meaningless unless the DOL was proposing changes to the form."

Compliance and Liability

As Buckey noted, a 2013 DOL FAQ on Notice of Coverage Options states that if an employer is covered by the FLSA, it should provide written notice to its employees about the health insurance marketplace but that there is no fine or penalty under the law for failing to do so.

Nevertheless, many benefits attorneys have recommended that employers subject to the FLSAprovide the notice to employees, noting that noncompliance could increase the risk of liability related to a DOL audit or an employee lawsuit.

While efforts by the Trump administration and the GOP-majority Congress are underway to repeal and replace the ACA and to limit its regulatory burdens, as long as the law remains in effect, employers are advised to stay compliant with its reporting and notification requirements.

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