Insight to Action

Benefits & Healthcare Update: Affordable Care Act's Automatic Enrollment Requirement Repealed

9 November 2015

The "automatic enrollment" provision of the Affordable Care Act, never enforced, has been repealed under the Bipartisan Budget Act of 2015, signed by President Obama on November 2, 2015.

As written in the 2010 ACA legislation, the automatic enrollment provision required employers that are subject to the Federal Labor Standards Act (FLSA) and which employed more than 200 full-time employees to automatically enroll new full-time employees in one of the employer's health plans, subject to any waiting period authorized by law. Notices would have been required giving employees an opportunity to opt out of any coverage in which the employee was automatically enrolled.

Although the auto-enrollment provision has been repealed, employers may still decide to use "default" or "negative" elections for enrolling employees into health plan coverage or certain other benefits, subject to state wage withholding laws. Under a default or negative enrollment arrangement, an otherwise eligible employee will be deemed to have elected a certain type and level of coverage unless the employee timely returns a written waiver of that coverage.

The Bipartisan Budget Act of 2015 can be found here: https://www.congress.gov/bill/114th-congress/house-bill/1314.

If you have any questions about the repeal of automatic enrollment or any other ACA market reforms, please contact Ed Doherty at 646-839-8251 or via email at EDoherty@cammackhealth.com.