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The Centers for Medicare and Medicaid Studies (CMS) has updated their website with information regarding how employers subject to the ACA’s Employer Mandate will be notified of employees who qualified for a subsidy, and how they can appeal any Part B penalties that are assessed as a result. The site can be found at https://www.cms.gov/CCIIO/Programs-and-Initiatives/Employer-Initiatives/Employer-Initiatives.html. The information on this site is vital for employers subject to the Employer Mandate.
The Notification Form
The site contains a sample notification form that will go to an employer. It is important to note that this is simply a notification that an employee received a subsidy – it is not a notification that the employer has been assessed a penalty under the Employer Mandate. Only the IRS can assess that penalty, and the employer will be notified separately if a penalty is owed. As of the date of this Notice, the form of that notification has not been disclosed.
It is vital that employers retain the notification form if they desire to appeal the determination that the employee was eligible for the subsidy. This is not the same as appealing any assessed penalty. Rather, this would be an appeal of the employee’s subsidy eligibility, which has the follow-on effect of appealing any associated penalty – if the subsidy was given to the employee in error, the employer won’t owe a penalty (since penalties only are owed when the employer doesn’t offer a minimum value plan that’s affordable to the employee).
When appealing the employee’s eligibility for a subsidy, they will need to include a copy of this notification. The sample notice is available here.
The Employer Appeal Form
The site also includes a sample employer appeal form that employers will use to appeal the subsidy determination. What’s important to note about this form is that it is individual to the notice that was received. Though not required, this is where employers will want to include copies of any enrollment materials that indicate affordability or minimum value that would have been provided to that employee, as well as a waiver that the employee may have signed. While most employers might expect to get no more than a handful of subsidy notifications, certain industries will likely see many forms, especially those employers in the staffing, retail and hospitality spaces. The workload for completing multiple appeal forms should be planned for accordingly.