Employee Benefits & Executive Compensation ADVISORY

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3 Employee Benefits & Executive Compensation ADVISORY OCTOBER 31, 2014 November 15th Deadline Quickly Approaching on ACA Transitional Reinsurance Fee This is an updated advisory discussing new guidance on the transitional reinsurance fee. Please note that guidance is frequently issued in this area. This advisory is up-to-date as of the date of publication, but follow-up guidance from CMS may supersede the information below. The deadline for submitting the required information and scheduling the required payment, which must be done through Pay.gov, is November 15, Transitional Reinsurance Program: An Overview The Affordable Care Act (ACA) provides for a transitional reinsurance program to help stabilize premiums for coverage in the individual health insurance market during the first three years of operation of the Health Insurance Marketplaces ( ). The program is designed primarily to transfer funds from the group market to the individual market, where high risk individuals are more likely to be covered. Payments to individual market insurers under the reinsurance program are funded by contributions (referred to in this advisory as fees ) payable by health insurance issuers and third-party administrators on behalf of self-insured group health plans. However, under the regulations, self-insured group health plans are ultimately responsible for the payment. Under the statute, a total of $25 billion will be collected for the three-year period from , $20 billion of which will be used to fund the reinsurance program and $5 billion of which will be paid into the general funds of the U.S. Treasury. In addition to these statutory amounts, states may impose additional contribution requirements to fund administrative expenses associated with the reinsurance program and/or to provide for additional reinsurance payments. Each state decides whether to establish a reinsurance program or whether to have the Centers for Medicare and Medicaid Services (CMS) administer the reinsurance program for the state. See our previous advisory 1 for more background about the transitional reinsurance program. 1 Health Care Reform Update: Final Regulations Impose Reinsurance Contribution on Fully Insured and Self-Insured Plans Starting in 2014, March 28, 2012, available at b b13f/12-196%20reinsurance%20fee.pdf. This advisory is published by Alston & Bird LLP to provide a summary of significant developments to our clients and friends. It is intended to be informational and does not constitute legal advice regarding any specific situation. This material may also be considered attorney advertising under court rules of certain jurisdictions.

4 2 Guidance Background Final regulations regarding the reinsurance program were initially published by CMS on March 16, These initial regulations have since been supplemented and modified on numerous occasions. 3 Current regulations may be found at 45 C.F.R , et seq. Application of the Fee to Group Health Plans Amount of the Fee The transitional reinsurance fee requirement applies on a per capita basis with respect to each individual covered by a plan subject to the fee (referred to here as covered lives ). The total amount for 2014 is $63 per covered life, and decreases to $44 per covered life in The amount of the fee for 2016 has not yet been set by CMS, but it will be lower than the 2015 amount, reflecting the lower aggregate amount required to be collected. Group Health Plans Subject to the Requirement The fee applies to major medical coverage, which with respect to group health plans means (1) small group health plans subject to the metal tier actuarial value requirements (generally, non-grandfathered, fully-insured plans other than excepted benefit plans), and (2) any health coverage for a broad range of services and treatments provided in various settings that provides minimum value (MV) as defined under the ACA (e.g., self-funded plans that provide MV). Below is a chart illustrating some common plans and/or arrangements and whether they are subject to the fee. Plans That Are Subject (unless an exception applies) Plans That Are Not Subject (See 45 C.F.R for a complete list.) Major Medical Coverage Excepted Benefits* Health FSAs Retiree Medical Coverage Prescription Drug Coverage HSAs*** COBRA Coverage Dental and Vision Coverage** Integrated HRAs Expatriate Coverage Coverage that fails to provide minimum value Retiree-only HRAs Stop-loss Coverage*** EAP, disease management program or wellness program that does not provide major medical coverage Limited exemption (2015 and 2016) for self-insured plans that do not use a TPA for certain claim functions [unlikely to apply to many plans] * As defined by the Public Health Service Act 2791(c). Excepted benefits include, for example, accident and disability coverage, specified disease coverage and stand-alone dental and vision coverage. ** These plans are excluded even if they constitute essential health benefits (i.e., pediatric dental coverage). *** Note, these arrangements are not considered group health plans. 2 The final regulations were published in 77 Fed. Reg (Mar. 23, 2012) and may be found at 3 HHS Notice of Benefit and Payment Parameters for 2014, 45 C.F.R. Parts 153, 155, 156, 157, and 158, 78 Fed. Reg (Mar. 11, 2013) ( gov/a/ ); HHS Notice of Benefit and Payment Parameters for 2015, 45 C.F.R. Parts 144, 147, 153, 155, 156, and 158, 79 Fed. Reg (Mar. 11, 2014) ( Program Integrity: Exchange, Premium Stabilization Programs, and Market Standards; Amendments to the HHS Notice of Benefit and Payment Parameters for 2014, 45 C.F.R. Parts 144, 146, 147, 153, 155, and 156, 78 Fed. Reg (Oct. 30, 2013) ( federalregister.gov/a/ ).

5 3 Who is Responsible for the Fee? The transitional reinsurance fee is imposed on the contributing entity, defined as an insurer for fully-insured coverage or the group health plan for self-insured coverage. Third-party administrators (TPAs), administrative service only entities (ASO) and others may submit on behalf of contributing entities, though CMS has specified that the TPA or ASO is not required by law to do so. Practice Pointer. Because the fee is imposed on the self-insured plan, not the plan sponsor, plan assets may be used to pay the assessment. The Internal Revenue Service has also noted that plan sponsors can treat the fee as an ordinary and necessary business expense for tax purposes (i.e., deductibility 4 ). Many plans allow employees to choose a single benefit option from an array of benefit options, some of which are self-funded and some of which are fully insured (e.g., several self-funded options with a fully-insured HMO). In that situation, if each option separately provides major medical coverage, then the insurer would be responsible for the fee with respect to covered lives under the insured benefit options, and the plan would be responsible for the fee with respect to covered lives under the selfinsured benefit options. There also may be situations where a plan is partially self-funded and partially fully insured and where different plans of the same sponsor together provide major medical coverage. The regulations contain rules to address these situations, including determining what entity is responsible for the fee and the counting rules that are available. Special rules also apply if a plan changes from self-funded to fully insured (or vice versa) in the middle of a calendar year. Finally, plans are not required to count individuals primarily residing in a U.S. territory not subject to the transitional reinsurance program and may exclude Medicare-eligible individuals if Medicare pays primary to the plan with respect to such individuals. How Do I Count Covered Lives? The term covered lives includes everyone covered under the plan or policy, e.g., spouses, dependents and retirees. Because the fee is based on the number of covered lives under the plan, it is important to pay careful attention to the permissible counting methods. Overview CMS has enumerated several options for counting covered lives, depending on whether the plan is insured or self-funded. The methods of counting covered lives for the reinsurance fee are similar to, but not exactly the same as, the Patient-Centered Outcomes Research Institute (PCORI) count methods; thus, plans should not rely on the PCORI methods for purposes of the reinsurance fee. 5 Plans may choose any applicable method, but the same method must be used for a benefit year (and across all plans). Note that the counting method does not need to be the same one the plan used for the PCORI fee. The counting period is generally the first nine months of the calendar year (except for the Form 5500 method), regardless of the plan year. A brief description of the counting methods is below, and helpful guidance on the methods for counting can be found here. 6 Practice Pointer. The enrollee counting rules are technical and can be very complicated. While TPAs can pull enrollment counts for the fee submission, employers should consult counsel if they have any questions about the application of the rules to their specific plan(s) See 45 C.F.R (d) 45 CFR (g). 6 Centers for Medicare and Medicaid Services, The Transitional Reinsurance Program Operational Guidance: Counting Method Examples for Contributing Entities (July 17, 2014), available at Downloads/Examples-of-Counting-Methods-for-Contributing-Entities.pdf.

6 4 Options Available to Insured Plans Actual method: Add the total number of covered lives for each day of the first nine months of the benefit year, then divide that total by the number of days in those nine months. Snapshot count method: Add the total number of covered lives on any date (or more dates, if an equal number of dates are used for each quarter) during the same corresponding month in each of the first three quarters of the year (for example, January, April and July), then divide that by the number of dates on which a count was made. Note that the date used for the second and third quarters must fall within the same week of the quarter as the corresponding date used for the first quarter. Member months/state form method: Multiply the average number of policies in effect for the first nine months of the benefit year by the ratio of covered lives per policy in effect, calculated using the prior NAIC exhibit or a form with the issuer s state of domicile. Options Available to Self-Insured Plans Actual method: Add the total number of covered lives for each day of the first nine months of the benefit year, then divide that total by the number of days in those nine months. Snapshot count and snapshot factor method: Count: Add the total number of covered lives on any date (or more dates, if an equal number of dates are used for each quarter) during the same corresponding month in each of the first three quarters of the year (for example, January, April and July), then divide that by the number of dates on which a count was made. Note that the date used for the second and third quarters must fall within the same week of the quarter as the corresponding date used for the first quarter. Factor: Add the total number of covered lives on any date (or more dates, if an equal number of dates are used for each quarter) during the same corresponding month in each of the first three quarters of the benefit year (for example, January, April and July), divided by the number of dates on which a count was made (note that the date used for the second and third quarters must fall within the same week of the quarter as the corresponding date used for the first quarter). Then, add the number of participants with self-only coverage and the product of the number of participants with coverage other than self-only coverage and a factor of Form 5500 method: For a plan offering more than self-only coverage (i.e., dependent or spousal coverage), add the number of participants at the beginning and end of the plan year from the most current Form 5500 (lines 5 and 6a 6c). For a plan offering self-only coverage, perform the same calculation, but divide this number by two. Practice Pointer. The choice of counting method may have a significant impact on the number of covered lives and the fee owed. For example, if a plan uses a wrap plan document and files a single Form 5500 for a plan that includes multiple health and welfare benefits, using the Form 5500 method to estimate the number of covered lives may significantly increase the number of covered lives (and thus, the fee). For example, if all employees receive employer-provided basic life coverage, the number of participants would include all employees, not just those enrolled in medical coverage. Please contact us if you would like assistance in choosing a method that minimizes the fee. Necessary Documentation Regardless of the method chosen, plans must maintain documentation of the count, including all materials provided by TPAs in arriving at this figure, for at least 10 years. CMS may audit a plan to assess its compliance with the program requirements, and it will be crucial to be able to produce this information.

7 5 Submitting the Fee Form Submission Process The entire reinsurance fee process takes place on Pay.gov. This process is separate from the Health Insurance Oversight System (HIOS) which is used, for example, to obtain a Health Plan Identifier (HPID). The applicable form became available on October 24, While this leaves somewhat limited time for plan sponsors to submit the applicable form and schedule the fee by the November 15, 2014, deadline, CMS has issued no guidance indicating that the submission date will be delayed. Thus, plan sponsors should act quickly to ensure compliance by the deadline. In order to successfully complete the reinsurance fee submission, plan sponsors (or their representatives) need to: Register on Pay.gov; Fill out the Transitional Reinsurance Form; Attach a supporting documentation file; and Schedule a reinsurance payment. More information about these steps is discussed in detail below. A helpful guide for the submission process is available here. 7 Form After registering on Pay.gov, the submitter will select the Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form. The form requires basic company and contact information, payment type, benefit year and the annual enrollment count (calculated using one of the methods above). Supporting Documentation After the information is entered into the form, plan sponsors will need to upload a Supporting Documentation CSV file. This file must contain certain company information, the annual enrollment count and the benefit year; in addition, certain technical requirements (such as file size and a prohibition on special characters) apply. CMS s Job Aid allows companies to create and error-test the file in advance. 8 Payment After the enrollment and supporting documentation information is submitted, the form will auto-calculate the amount owed by multiplying the required amount by the number of covered lives. Plans then need to schedule payment(s) for this amount; the form cannot be submitted without payment information. Plans can choose to remit payment for the entire benefit year at once (the full $63 per covered life), or plans can submit two separate payments for the year. If the separate payment method is used, the first payment ($52.50 per covered life) is due by January 15, 2015, and the second payment ($10.50 per covered life) is due by November 15, Plans may choose to schedule earlier payments. CMS suggests leaving 30 days between the form submission and payment date i.e., an early December 2014 payment date for plans wishing to pay earlier than January 15, Regardless of the option chosen, the payments MUST be scheduled by November 15, Note that if a plan chooses to submit two payments, the plan must submit the same form and supporting documentation (with the same information) twice. An automated clearinghouse (ACH) payment is currently the only accepted payment method, although CMS may send an invoice if there are problems with payment. Plans need to add a particular ALC+2 value (according to CMS guidance, ) with the applicable bank to ensure the payment is processed correctly; the company name for ACH purposes is USDEPTHHSCMS. 7 Centers for Medicare and Medicaid Services, ACA Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form Manual (Oct. 20, 2014), available at RIC_FormManual_102014_v1.pdf 8 The file, and associated manual, are available on Regtap and at this link: The-Transitional-Reinsurance-Program/Reinsurance-Contributions.html.

8 6 Finally, plans can only include one bank account per form, so make sure to choose an account with a large enough balance for the fee. What Should Plans Do to Prepare Before Submitting the Form and Supporting Documentation? The actual submission process will be smoother if plan sponsors are prepared with the necessary information. To prepare for this process, plan sponsors should: Collect relevant information; Count covered lives (remember, the method chosen can affect the amount of the fee); Prepare a CSV file; and Notify the bank of the applicable ALC+2 value. Enforcement In response to questions about how the fee will be enforced, CMS issued an FAQ stating that reinsurance contributions are considered federal funds and are thus subject to the False Claims Act. The FAQ also referred to regulations stating that, with respect to health insurance issuers, the fee is a determination of debt subject to federal debt collection. Although the regulations refer only to insurers and not self-funded plans, it is expected that CMS will pursue enforcement with respect to both types of plans.

9 7 If you would like to receive future Employee Benefits & Executive Compensation Advisories electronically, please forward your contact information to Be sure to put subscribe in the subject line. If you have any questions or would like additional information, please contact your Alston & Bird attorney or any of the following: Members of Alston & Bird s Employee Benefits & Executive Compensation Group Robert A. Bauman bob.bauman@alston.com John R. Hickman john.hickman@alston.com Craig R. Pett craig.pett@alston.com Michael L. Stevens mike.stevens@alston.com Saul Ben-Meyer saul.ben-meyer@alston.com H. Douglas Hinson doug.hinson@alston.com Earl Pomeroy earl.pomeroy@alston.com Daniel G. Taylor dan.taylor@alston.com Stacy C. Clark stacy.clark@alston.com Emily C. Hootkins emily.hootkins@alston.com Jonathan G. Rose jonathan.rose@alston.com Elizabeth Vaughan beth.vaughan@alston.com Emily Seymour Costin emily.costin@alston.com James S. Hutchinson jamie.hutchinson@alston.com Syed Fahad Saghir fahad.saghir@alston.com Kerry T. Wenzel kerry.wenzel@alston.com Patrick C. DiCarlo pat.dicarlo@alston.com Johann Lee johann.lee@alston.com Thomas G. Schendt thomas.schendt@alston.com Kyle R. Woods kyle.woods@alston.com Meredith Gage meredith.gage@alston.com Blake Calvin MacKay blake.mackay@alston.com John B. Shannon john.shannon@alston.com Ashley Gillihan ashley.gillihan@alston.com Emily W. Mao emily.mao@alston.com Richard S. Siegel richard.siegel@alston.com David R. Godofsky david.godofsky@alston.com Steven Mindy steven.mindy@alston.com Carolyn E. Smith carolyn.smith@alston.com ALSTON & BIRD LLP 2014 ATLANTA: One Atlantic Center 1201 West Peachtree Street Atlanta, Georgia, USA, Fax: BRUSSELS: Level 20 Bastion Tower Place du Champ de Mars B-1050 Brussels, BE Fax: CHARLOTTE: Bank of America Plaza 101 South Tryon Street Suite 4000 Charlotte, North Carolina, USA, Fax: DALLAS: 2828 North Harwood Street 18th Floor Dallas, Texas, USA, Fax: LOS ANGELES: 333 South Hope Street 16th Floor Los Angeles, California, USA, Fax: NEW YORK: 90 Park Avenue 15th Floor New York, New York, USA, Fax: RESEARCH TRIANGLE: 4721 Emperor Blvd. Suite 400 Durham, North Carolina, USA, Fax: SILICON VALLEY: 1950 University Avenue 5th Floor East Palo Alto, California, USA, Fax: WASHINGTON, DC: The Atlantic Building 950 F Street, NW Washington, DC, USA, Fax:

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12 1 Group Health Plans that Fail to Cover In-Patient Hospitalization Services Notice I. PURPOSE AND OVERVIEW The Department of Health and Human Services (HHS) and the Department of the Treasury (including the Internal Revenue Service) (collectively, the Departments) have become aware that certain group health plan benefit designs that do not provide coverage for in-patient hospitalization services are being promoted to employers. A plan that fails to provide substantial coverage for these services would fail to offer fundamental benefits that are nearly universally covered, and historically have been considered integral to coverage, under typical employer-sponsored group health plans. Promoters of these plans contend that the plans satisfy minimum value within the meaning of the Affordable Care Act (including section 36B(c)(2)(C)(ii)of the Internal Revenue Code (Code) and final HHS regulations under section1302(d)(2)(c) of the Affordable Care Act (referred to in this notice as minimum value or MV)), as determined through use of the on-line MV Calculator referred to in final HHS regulations and proposed Treasury regulations. Questions have been raised as to whether plans that fail to provide substantial coverage for in-patient hospitalization services should satisfy the requirements for providing minimum value. Concerns have been raised as to whether the continuance tables underlying the MV Calculator (and thus the MV Calculator) produce valid actuarial results for unconventional plan designs that exclude substantial coverage for in-patient hospitalization services. These concerns include that the standard population and other underlying assumptions used in developing the MV Calculator and associated continuance tables are based on typical self-insured employer-sponsored plans, essentially all of which historically have included coverage for these services, and that designing a plan to exclude such coverage could substantially affect the composition of the population covered by discouraging enrollment by employees who have, or anticipate that they might have, significant health issues. It has been suggested that these and other effects resulting from excluding substantial coverage of in-patient hospitalization services may not be adequately taken into account by the MV Calculator and its underlying continuance tables. Similar concerns have been raised regarding the possibility of using the MV calculator to demonstrate that an unconventional plan design that excludes substantial coverage of physician services provides minimum value. The Departments believe that plans that fail to provide substantial coverage for in-patient hospitalization services or for physician services (or for both) (referred to in this notice as Non-Hospital/Non-Physician Services Plans) do not provide the minimum value intended by the minimum value requirement and will shortly propose regulations to this effect with a view to being in a position to finalize such regulations during 2015 and make them applicable upon finalization. Accordingly, employers should consider the consequences of the inability to rely solely on the MV Calculator (or any actuarial

13 2 certification or valuation) to demonstrate that a Non-Hospital/Non-Physician Services Plan provides minimum value for any portion of any taxable year ending on or after January 1, 2015, that follows finalization of such regulations. However, solely in the case of an employer that has entered into a binding written commitment to adopt, or has begun enrolling employees in, a Non-Hospital/Non-Physician Services Plan prior to November 4, 2014 based on the employer s reliance on the results of use of the MV Calculator (a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan), the Departments anticipate that final regulations, when issued, will not be applicable for purposes of Code section 4980H with respect to the plan before the end of the plan year (as in effect under the terms of the plan on November 3, 2014) if that plan year begins no later than March 1, Pending issuance of final regulations, an employee will not be required to treat a Non-Hospital/Non-Physician Services Plan as providing minimum value for purposes of an employee s eligibility for a premium tax credit under Code section 36B, regardless of whether the plan is a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan. II. BACKGROUND An employee or family member who is offered coverage under an eligible employer-sponsored plan that offers affordable MV coverage for the employee may not receive premium tax credit assistance under Code section 36B for coverage in a qualified health plan. An applicable large employer (as defined in Code section 4980H(c)(2)) may be liable for a section 4980H assessable payment if one or more of its full-time employees receives a premium tax credit. Under Code section 36B(c)(2)(C)(ii), a plan provides MV if the plan's share of the total allowed costs of benefits provided under the plan is at least 60 percent of the costs. Section 1302(d)(2)(C) of the Affordable Care Act provides that in determining the percentage of the total allowed costs of benefits provided by a group health plan or health insurance coverage under the Code, as well as under the Public Health Service Act (PHSA), regulations promulgated by the Secretary of HHS under section 1302(d)(2), addressing actuarial value, apply. HHS published final regulations under section 1302(d)(2) on February 25, 2013 (78 FR 12834), effective on April 26, For plans required to cover the essential health benefits (EHB), the HHS regulations define the percentage of the total allowed costs of benefits as (1) the anticipated covered medical spending for EHB (as defined in 45 CFR (a)) paid by a health plan for a standard population, (2) computed in accordance with the plan's cost-sharing, and (3) divided by the total anticipated allowed charges for EHB coverage provided to a standard population. 45 CFR As stated in the preamble to the HHS regulations (see 78 FR 12833), employersponsored group health plans are not required to offer EHBs unless they are insured health plans offered in the small group market subject to section 2707(a) of the PHSA.

14 3 The preamble also states that MV is measured based on the provision of EHBs to a standard population based on typical self-insured group health plans and that, in determining MV, plans may take into account those benefits covered by the employer that are covered in any one of the state EHB-benchmark plans. See 45 CFR (b). Proposed regulations under Code section 36B on MV published by Treasury and the IRS on May 3, 2013 (78 FR 25909), apply these rules in defining the standard population for MV purposes and the MV percentage. The proposed Code section 36B regulations provide that the MV percentage is determined by dividing the plan's anticipated spending (based on the plan s cost-sharing) for EHB under any one state benchmark plan by the total cost of EHBs for the standard population and converting the result to a percentage. Proposed 26 CFR 1.36B-6(c). Neither the final HHS regulations nor the proposed Code section 36B regulations require employer-sponsored self-insured and insured large group plans to cover every EHB category or conform their plans to an EHB benchmark that applies to individual and small group market plans. The HHS regulations allow MV to be determined using an MV Calculator (available at or a safe harbor established by HHS and the IRS. Under the regulations, plans with nonstandard features that are incompatible with the MV Calculator or a safe harbor may determine MV through an actuarial certification from a member of the American Academy of Actuaries. A plan in the small group market provides MV if it meets the requirements for any of the levels of metal coverage defined at 45 CFR (b) (bronze, silver, gold, or platinum). The proposed Code section 36B regulations require plans to determine MV by using either a safe harbor or the MV Calculator. Employers using the MV Calculator may, however, supplement the MV Calculator by obtaining actuarial valuation of a plan s nonstandard features. III. INTENDED APPROACH A. Proposed Amendments to Regulations Relating to Minimum Value HHS intends to promptly propose amending 45 CFR to provide that a plan will not provide minimum value if it excludes substantial coverage for in-patient hospitalization services or physician services (or both). Treasury and the IRS intend to issue proposed regulations that apply these proposed HHS regulations under Code section 36B. Accordingly, under the HHS and Treasury regulations, an employer will not be permitted to use the MV Calculator (or any actuarial certification or valuation) to demonstrate that a Non-Hospital/Non-Physician Services Plan provides minimum value. It is anticipated that the proposed changes to regulations will be finalized in 2015 and will apply to plans other than Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plans on the date they become final rather than being delayed to the end of 2015 or the end of the 2015 plan year. As a result, a Non-Hospital/Non-Physician

15 4 Services Plan (other than a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan) should not be adopted for the 2015 plan year. (As noted above, it is anticipated that the proposed changes to regulations, when finalized, will not apply to Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plans until after the end of the plan year beginning no later than March 1, The Departments anticipate that final rulemaking will be completed on or about that date.) Pending issuance of final regulations, in no event will an employee be required to treat a Non-Hospital/Non-Physician Services Plan as providing MV for purposes of an employee s eligibility for a premium tax credit under Code section 36B, regardless of whether the plan is a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan. B. Employer Duty to Inform Employees An employer that offers a Non-Hospital/Non-Physician Services Plan (including a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan) to an employee (1) must not state or imply in any disclosure that the offer of coverage under the Non- Hospital/Non-Physician Services Plan precludes an employee from obtaining a premium tax credit, if otherwise eligible, and (2) must timely correct any prior disclosures that stated or implied that the offer of the Non-Hospital/Non-Physician Services Plan would preclude an otherwise tax-credit-eligible employee from obtaining a premium tax credit. Without such a corrective disclosure, a statement (for example, in a summary of benefits and coverage) that a Non-Hospital/Non-Physician Services Plan provides minimum value will be considered to imply that the offer of such a plan precludes employees from obtaining a premium tax credit. However, an employer that also offers an employee another plan that is not a Non-Hospital/Non/-Physician Services Plan and that is affordable and provides MV is permitted to advise the employee that the offer of this other plan will or may preclude the employee from obtaining a premium tax credit. FOR FURTHER INFORMATION The Departments have coordinated on the guidance and other information contained in this notice, and HHS is concurrently issuing parallel guidance. Questions concerning the information contained in this notice may be directed to HHS at or the IRS at Additional information for employers regarding the Affordable Care Act is available at and

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