No More Election-Lock for Cafeteria Plans with Non-Calendar Plan Years
“There are six important things for employer-sponsors to note:[1] The cafeteria plan is permitted to rely upon the employee’s representation of intent to enroll in a Marketplace plan … (actual proof of enrollment is not required).
[2] The employer-sponsored cafeteria plan document must be amended to allow for such a mid-year election change….
[3] In no event under this guidance may a cafeteria plan allow a participant to revoke a coverage election on a retroactive basis.
[4] Mid-year election changes under this guidance are permitted, but not required.
[5] This guidance does not extend to health FSA elections.
6] As long as the employee is still eligible for the employer-sponsored coverage (assuming it is affordable and of minimum value), the employee will not be eligible for tax credits in the Marketplace
(Hill, Chesson & Woody)
