The Wagner Law Group
Wagner Law Group, A Professional Corporation, is a nationally
recognized ERISA & employee benefits, estate planning,
employment, labor & human resources practice.
in 1996, The Wagner Law Group has 22 attorneys engaged
exclusively in employee benefits, estate planning and
employment law. Six of our attorneys are AV rated by
Martindale-Hubbell as having very high to preeminent legal abilities
and ethical standards. The firm is among the largest ERISA boutiques
in the country. Our practice is national in scope, with clients in
more than 40 states and several foreign countries.
Wagner Law Group
Fax: (561) 293-3591
7108 Fairway Drive
Palm Beach Gardens, FL 33418
East Kennedy Boulevard
Tampa, FL 33602
Francisco, CA 94104
100 South 4th Street, Suite 550
St. Louis, MO 63102
November 13, 2015
Health and Welfare Law
Legislation Repeals ACA's Automatic Enrollment Requirement
Obama has recently signed H.R. 1314, the Bipartisan Budget Act of
2015 which, among other things, repealed the automatic enrollment
provision provided in the Affordable Care Act ("ACA"). The
Congressional Budget Office estimates that repealing the ACA's
automatic enrollment provision will result in an additional $8
billion in revenue due to fewer people enrolling in employers' group
health plans, which will reduce employers' costs and thereby increase
employers' taxable income.
Background. Under the ACA, employers that offer health
insurance and that employ more than 200 full-time employees were to
be required to automatically enroll new, full-time employees in one
of the employer's group health plans, subject to any waiting periods.
ACA further required employers to notify employees that they could
opt out of the employer's group health plans.
Department of Labor ("DOL") announced in 2010 that it
interpreted the ACA's automatic enrollment provision as not taking
effect until it issued implementing regulations and that it did not
expect to do this until 2014. In 2012, DOL announced that it would
not issue implementing regulations for the automatic enrollment
provision by 2014, given the need to coordinate its implementation
with other ACA provisions, including the employer mandate and the
prohibition on waiting periods exceeding 90 days. DOL confirmed that
employers did not need to comply with the automatic enrollment
provision until it issued the implementing regulations. Now, under the
new Bipartisan Budget Act, employers no longer need to worry about
for Employers. Although the
ACA's automatic enrollment requirement has been repealed, employers
may continue to use default or negative elections to enroll employees
in group health plan coverage, if they choose to do so. (Note:
Under a default or negative enrollment arrangement, an otherwise
eligible employee will be deemed to have elected a stated type and
level of coverage unless the employee submits a written waiver of
that coverage.) The IRS permitted this practice in a 2002 revenue
ruling, and affirmed the approach in 2007 under its proposed
regulations for Section 125.
to the now-repealed ACA requirement, employers that have default or
negative elections must notify employees about the coverage,
including the cost for coverage, and allow employees to opt out.
Employers should consider this practice carefully and consult with
qualified benefits advisors before implementing such arrangements.
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