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Employers sent notices about workers who got health insurance subsidies

July 15, 2016
Several hundred thousand notices mailed to companies in late June from the U.S. Department of Health and Human Services about employees identified as eligible for health insurance subsidies as part of a national Health Insurance Marketplace.
The notice informs the employer that an individual worked for the employer and either (a) didn’t have an offer of health care coverage from the employer; (b) did have an offer of coverage but it wasn’t affordable or did not provide minimum coverage; or (c) was in a waiting period and unable to enroll in health care coverage.
The HHS notices are part of the verification process established to ensure that individuals awarded subsidies are eligible to receive them. Employers who receive a subsidy notification and believe one was awarded to an employee in error have the option to appeal the award. Not doing so may expose an employer with 50 or more full-time workers to pay-or-play penalties.
Employers should consider appealing a notice if they believe an employee’s receipt of a subsidy is in error. For example, if the employer believes that the employee was offered affordable, minimum value coverage, or the employee is actually enrolled in the employer’s plan and thus, in either case, is ineligible for a subsidy..
Employers do not need to appeal subsidy notifications for part-time employees (unless the notice inaccurately identifies them as full-time employees), employees who terminated while in a waiting period for coverage, or notifications naming spouses or family members as recipients of a subsidy.