Health Insurance Marketplaces are now sending letters to notify certain employers that one or more of their employees has been determined eligible for advance premium tax credits and cost-sharing reductions and has enrolled in a Marketplace plan. Because these events may trigger employer penalties under the Affordable Care Act’s “pay or play” provisions, employers may seek to appeal an employee’s eligibility determination.
Employer Appeals Process
Marketplaces must notify employers within a reasonable timeframe following any month of the employee’s eligibility determination and enrollment. Employers have 90 days from the date stated on the Marketplace notice to file an appeal. In the appeal, the employer may assert that it provides its employee access to affordable, minimum value employer-sponsored coverage or that its employee is enrolled in employer coverage, and therefore that the employee is ineligible for advance payments of the premium tax credit or cost-sharing reductions.
An appeal will not determine if the employer is subject to a “pay or play” penalty, as only the IRS, not the Marketplace or the Marketplace Appeals Center, can make such determinations.
The Pay or Play section of your HR library features step-by-step guidance, worksheets, and calculators that can help employers understand if they will be subject to a penalty and how to calculate it.