The first batch of health insurance marketplace notices have recently been sent out and you may have received one. Below is a description of what these notices mean, why some receive them, and how you should respond.
What Do These Notices Mean?
These notices can mean a number of things. Either an individual is receiving or set to receive federal assistance to reduce their premiums monthly, they have acquired individual health coverage via the Marketplace, or you informed the Marketplace that you didn’t receive minimum health insurance coverage from your employer.
Can These Notices Be Appealed?
It’s up to the individual, but it is not mandatory for a notice to be appealed. You may want to consider an appeal if you have presented an offer for minimum affordable coverage for the person named in the notice, especially if it was done in 2016. The reason for this is because it could help you or someone else prevent a tax bill.
Those who filed the Form 1095-C for 2016 conveyed to the IRS that the company presented their employees with minimum affordable coverage. Should the IRS find out that an employee was not eligible for premium assistance, that employee will be expected to provide reimbursement for the assistance, in part or whole. This amount can be high.
An appeal today can also prevent having to do another associated with employer penalties. Should the Marketplace determine that an employee was not eligible to receive premium assistance and didn’t get it; the IRS shouldn’t have to contact you by the end of the year.
When Should These Notices Not Be Appealed?
These notices should not be appealed for those who have not been presented with minimum affordable coverage, as it will not influence the decision of the IRS to assess a coverage penalty. The appeal process for this Marketplace related notices are operated by the Department of Health and Human Services. They are designed to figure out whether certain individuals are eligible to receive premium assistance so that health coverage can be acquired within a given year.
The Marketplace simply wants to know if someone is eligible and whether or not an offer was presented to them. If an appeal is made, it should note the months in which a person elected coverage or might have elected it, even if they ultimately waived it.
What If The IRS Contacts You?
The IRS will distribute a different notice and process for appeals prior to determining the penalty for employers. Any IRS notice that involves play or pay penalties should be addressed immediately, as the play or pay penalty is placed on employers who present health coverage to their employees which is either found to be inadequate or completely not affordable. Such plans usually don’t offer minimum value so an employee that works full time would acquire insurance through the Marketplace using premium assistance.