Farmers take notice: the Affordable Care Act (ACA) requires employers provide employees with an “Exchange Notice” by October 1, 2013. The notice must be provided to all current and new full-time and part-time employees, including H2A workers, and seasonal employees.

An Exchange Notice is a written notice informing your employees of their ability to purchase health insurance coverage through a state or federally-administered exchange. The Exchange Notice also explains some of the benefits and consequences to your employees if they choose to purchase health coverage through an exchange, particularly if they elect not to participate in a health insurance plan you offer as their employer.

Model Exchange Notices can be accessed here, here and here.

The Mississippi Farm Bureau – which provided the information presented -- is reminding producers that the notice “is required regardless of whether or not an employer offers health insurance to their employee(s). There are forms that the employee signs acknowledging the have been made aware of the exchange.”

For U.S. Department of Labor (USDOL) guidance, see here.

It is recommended that you confirm with counsel or your consultant before determining that you are not subject to the FLSA and therefore are not required to provide your employees with an Exchange Notice.

USDOL guidance sets forth a minimum amount of information your must provide to your employees.  At a minimum, the Exchange Notice must inform your employee of the following: 

  1. The name and contact information of the health exchange available in your state (see here).
  2. Describe the services provided by the exchange available in your state. Each exchange website will provide additional information and a description of services provided. Providing your employee with the website for the exchange available in your state is sufficient to meet this requirement.
  3. Inform your employees that they may be eligible for premium tax credits or cost sharing reductions if they chose to purchase health coverage on the exchange.

Note:Tell your employees whether or not the health coverage offered as an employee benefit meets the “minimum value” test provided in the ACA.  To make this determination, it is suggested that you contact your health plan’s broker. If your plan fails the minimum value test then your employees may be eligible for a premium tax credit if they choose to purchase health coverage on an exchange.

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  1. Inform your employees that if they elect to purchase health coverage on the exchange (and not your employer-sponsored plan), the employee will forfeit your contribution to their health coverage premium.
  2. Inform your employees that if they elect to purchase health coverage on the exchange, not only will they forfeit your contribution to their health coverage premium, they may also lose the related tax benefit associated with your contribution since it may have been excludable from the employee’s income for federal income and payroll tax purposes.