With several key Health Care Reform provisions scheduled to take effect in 2014, especially the option for employees to purchase health insurance through the Health Insurance Marketplace in each state, regulators have some concern that employers might retaliate against employees who purchase Marketplace-based coverage and receive a premium tax credit or cost-sharing reduction.
Consequently, the Occupational Safety and Health Administration (OSHA) has issued interim final regulations (late-April 2013) implementing the whistleblower protections of Section 1558 of the Affordable Care Act (ACA). Section 1558 of the ACA amended the Fair Labor Standards Act (FSLA) to add a new Section 18C, which prohibits large public and private sector employers (50 or more employees) from retaliating against an employee because the employee receives a premium tax credit or cost-sharing reduction for the Marketplace-based health coverage they purchased. The section targets these large employers because these employers are subject to the Employer Shared Responsibility (“Play-or-Pay”) mandate and there are possible tax penalties for not complying. Employers of any size are also prohibited from retaliating against employees for reporting or refusing to participate in potential violations of Title I of the ACA (e.g., health plans cannot impose an annual or lifetime limit on the reimbursement of covered expenses, etc.) or for testifying, assisting, or otherwise participating in a proceeding concerning a violation.
An employee or a representative of the employee can act as the whistleblower and make a claim that they believe they’ve been discharged or otherwise discriminated against with respect to compensation, terms, conditions or other privileges of employment for engaging in activity protected by Section 1558. For example, retaliation could be in the form of firing, blacklisting, disciplining or denying benefits; all of which would violate the ACA.
If OSHA determines that a whistleblower was retaliated against, “it will issue a determination letter requiring the employer to pay back wages, reinstate the employee, reimburse the employee for attorney and expert witness fees, and take other steps to provide necessary relief. Complaints found not to have merit will be dismissed.”
Although Section 18C became effective with the ACA on March 23, 2010, it is the advent of the Health Insurance Marketplace that prompted OSHA to issue the interim final guidance. Effectively, employees are protected from retaliation by the employer that sponsors the group health plan and also from retaliation by the insurer that issued the group health insurance plan.