The Obamacare Health Insurance Exchange, an online marketplace where consumers and employers can shop for qualified health plans, will be open in two weeks. With that Oct. 1 kickoff, restaurant operators will be required to inform all employees and new hires about the existence of the HIX, and tell them they may qualify for tax credits if they can't afford an employer's plan.
The notification must be provided in writing to all employees individually.
This is the first requirement in a series of stipulations expected to be put into place under the vast Obamacare legislation. This should be an actionable item right now for restaurant operators, large and small.
"This requirement is for all employers who are subject to the Fair Labor Standards Act, which is basically those who are required to pay minimum wage. This is a big priority, and the system will be in place for new hires going forward, forever," said Michelle Neblett, director of Labor and Workforce Policy at the National Restaurant Association.
The purpose of the notice is to educate employees about the HIX and how to obtain insurance. Employers are also expected to have a record of providing the notice to each employee. The NRA has a portal — free to members — for employers to help them keep track of these notifications and receipts.
There are no monetary penalties for not providing the notice, however it is a statute and "statutes trump all," Neblett said.
"Employees have a right to get that notification. It only needs to be done one time for an employee and it can be done in a variety of ways — in paper form, in pay stubs, electronically. The key is that the employee actually receives the information. If you put a stack of notifications in the break room, it won't meet the threshold," she said.
For new employees, she suggests including the notification in the normal onboarding process.
Another actionable item for operators at this point in the process is identifying the communication flow.
"Who is going to be the point person to take employee questions? Is it the manager, the HR department? Also, the exchanges might have questions for employers, so it's important to figure out who is going to handle those questions," Neblett said. "Businesses should really be thinking about that communication flow right now."
In addition to educating their employees about the HIX, employers should also be communicating any changes coming up, as well as explaining the law and it's potential impact on business.
"Are you going to do the bare bones stuff required by law, or is it a good idea to provide more education? We think that will be an operator-by-operator decision, but the communication is definitely something they should be thinking about now," Neblett said.
Employer reporting requirements
On Sept. 9, another proposed regulation was added to the Obamacare legislation, coming from the IRS. Under this proposed rule, employers are subject to employee coverage reporting. Neblett said the reporting requirement as it's written now is very specific. For example, for each person enrolled in coverage, the employer must report:
- Name, address, employer ID number of the employer;
- Certification as to whether the employer offers full-time employees and dependents the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan;
- Number of full-time employees for each month during the calendar year;
- For each full-time employee, the months during the calendar year for which coverage under the plan was available;
- For each full-time employee, the employee's share of the lowest cost monthly premium (self-only) for coverage, providing minimum value offered to that full-time employee under an eligible employer-sponsored plan. This information must be provided for each calendar month;
- Name, address, and Taxpayer Identification Number of each full-time employee during the calendar year and the months, if any, during which that employee was covered under an eligible employer-sponsored plan; and
- Any other such information as the IRS may require.
There are also reporting requirements for employers sponsoring self-insured plans, and employers to covered individuals. Reporting must cover information for the 2015 calendar year, and continue annually. The IRS is encouraging employers to voluntarily comply with the information sooner, to test reporting systems and plan designs prior to full implementation in 2015.
"We're encouraging operators to take a look at these rules. Even though they're still in development, we're taking feedback and comments and submitting that to the IRS," Neblett said.
As it stands right now, the employer reporting requirement is expected to have a deadline to the IRS by February or March 2016. Employers should provide this information to their employees by Jan. 31, 2016.
"The reporting requirements have two pieces — information goes to the IRS and, similar to a 1099 or W2, the employee gets a copy," Neblett said.
The IRS will assess applicable penalties around April 2016.
The law is going forward
Neblett concedes there is a lot of information for restaurant operators to learn about Obamacare, and there are still a variety of inquiries coming into the NRA. Her biggest piece of advice is not to wait to take action.
"There has been some holding out for the Congressional effort to defund Obamacare, but there is no possibility of that happening. Even proponents of defunding the law have admitted there is no likelihood of this happening. The law is going forward and people should continue to prepare and look at all of their options," Neblett said. "A lot of people are analyzing and trying to figure this out and we'll have a better picture of cost late in the fourth quarter after the exchanges have been in place. But there remains a lot of certainty and it's important to understand the process now. Don't wait."
The NRA has resources to further educate operators, including:
- NRA's HealthCare Site: restaurant.org/healthcare
- NRA's HealthCare Notification Tool: http://notify.restaurant.org/
- HealthCare Primer (free): http://healthcare.restaurant.org/Tools-Solutions/Health-Care-Law-Primer
Read more about insurance coverage.
Photo provided by Wikimedia.