The Building Tradesman Newspaper

Friday, July 12, 2013

You’ll likely shrug at first contact with Affordable Care Act

By The Building Tradesman

This is the latest in a series of articles on the pending impact of the Affordable Care Act, on building trades union members.

It’s looking like the first contact building trades union workers are going to have with Affordable Care Act is a letter that’s due to be sent to them from their employers, on or around Oct. 1, 2013.

It’s also looking like the reaction to the letter from most actively employed workers should be the old office standby: “receive and file,” and then don’t do anything. But there are a few exceptions.

“Employers are required to send this letter to their employees, and there is going to be some confusion,” said Paul Catenacci, an associate attorney with Novarra-Tesija PC, which handles about a dozen multi-employer plan funds in Michigan. “For the people eligible for health care coverage under their existing plan, the letter is no big deal. But for unemployed workers who are in plans where they self-pay insurance or have an hour bank system and they’re low on hours, getting into an exchange could be something to look at.”

The “exchange” he refers to was explained by an article in our last issue. In it, attorney John Tesija explained that health care exchanges “are supposed to be an insurance shopping center of sorts where individuals who do not have coverage from their employer can look for insurance and small businesses can look to purchase policies for their employees.”

Back to the letter. It’s explained in a June 27 article written by Segal Consulting for The Association of Union Constructors. It’s called, “What Sponsors of Multi-Employer Plans Need to Know about the Model Employer Notice Under The Affordable Care Act and Revised Model COBRA Election Notice.”

The article focuses on the federal requirement for employers to notify employees of the availability of the aforementioned health insurance exchanges. The U.S. Department of Labor has issued two model notices that employers may use to notify employees, as well as a revised election notice for purchasing continued insurance under COBRA.

Segal said no later than Oct. 1, 2013, employers need to be “alerting employees about the option of purchasing coverage on the exchanges (now called “Marketplaces” by the federal government).” Segal said the obligation to provide the notice “is legally that of the employer, not the plan, but employer will need the assistance of multi-employer plans to complete the information on the form.”

But just because building trades workers will be getting letters from their employers, doesn’t mean they have to do anything. “Plan sponsors will need to consider a communications campaign informing participants about the meaning of the new exchange system,” Segal said, “and the fact that it will not replace their group health coverage and will not require them to sign up on the exchanges.”

Furthermore, Segal said: “It is likely that plan participants may become confused about their coverage and how they are affected by the exchanges if the notice comes from an employer, not a multi-employer plan. Consequently, plan sponsors may want to proactively provide plan participants with information about the exchanges with the right message, namely, that the participant will not lose coverage in the plan and does not need to enroll in the exchange.”

Segal also offered some advice to multi-employer plan fund trustees: “Trustees may want to communicate directly with their participants to avoid confusion when they receive these notices from their employers. This communication could explain that employers are required to send these notices, plan participants do not need to enroll in the Marketplaces, and their coverage through the multi-employer plan will continue. It could also alert participants that they may want to consider enrolling in Marketplace coverage during periods when they do not work sufficient hours to earn coverage under the multi-employer plan.”

Catenacci said sorting out federal requirements on Affordable Health Care Act is “going to be a difficult and confusing task for everybody” – including workers, health care administrators and lawyers.

The announcement last week that the Affordable Health Care Act will be delayed in  implementation does not affect the sending of the letter.