DOL Employer Insurance Notification – $100 per day fine appears to be a myth!


How many people remember when the PPACA (Health Reform Law) was being debated in congress that the then speaker of the house said:

 “we have to pass the bill so that you can find out what is in it.”

Well, it appears that, long after the bill was passed and became law, we are still trying to figure out what is in it!

Today the Department of Labor (DOL) has announced that there will be no penalty of $100.00 per day for employers who fail to provide notification to its employees of health insurance options. The last week it was widely speculated, and accepted that employer’s who were not in compliance could be subject to that fine. The DOL’s website released the following information under a FAQ section on their website:

Q: Can an employer be fined for failing to provide employees with notice about the Affordable Care Act’s new Health Insurance Marketplace?

A: No. If your company is covered by the Fair Labor Standards Act, it should provide a written notice to its employees about the Health Insurance Marketplace by October 1, 2013, but there is no fine or penalty under the law for failing to provide the notice.

You can reach this FAQ by clicking HERE



A little known requirement of the PPACA (health care reform law) is that it places a duty on Employers (with 1 (or more) employee & $500,000 (or more) in annual gross revenue) to provide every employee notice of the Health Insurance Coverage Options including Notice of the employees opportunity to find insurance in the state/federal marketplace(formerly Exchange).  The Dept of Labor issues a Guidance in May prior to the postponement of the employer mandate – but it is apparent they are not postponing this notice duty. 

 So, what happens if you fail to provide this notice?

The rule’s stated penalty is a continuing fine of $100.00 per day!

The Guidance provides a sample Word form to use for the notice.  We recommend using this form because if it is fully completed, you will be assured compliance with the requirement.   The Notice must be mailed to the employee for receipt not later than 10/1/2013 or electronically sent  if the email complies with DOL’s safe harbor for electronic disclosure. 

(Suggestion: If you choose the email option you should probably be sure to use a “READ Receipt” function). 

Links to the sample form and the safe harbor are included in the DOL Technical Release 2013-02 which can be found at:



Also, this notice requirement includes an employer duty to provide any and all new hires the same notice at the time of hiring.




Exclamation question mark

As a quick followup note to our earlier post about the new HIPAA final rule there is a significant, but easily overlooked, timeline for implementation of Business Associate Agreements (BAA’s)!

If you implement (draft and signed between the parties) a Business Associate Agreement BEFORE FRIDAY JANUARY 25, 2013  you will have 1 Extra Year to fully comply with various portions of the new business associate rules!

The new rule places a deadline of SEPTEMBER 23 2013 for covered entities and Business Associates to be compliant with various portions of the new requirements!!!

HOWEVER, if covered entities implement a basic form of Business Associate Agreement (BAA) by or before JANUARY 25 2013, those “basic” agreements will be considered as a sufficient step towards compliance to extend the time when the full weight of the new rules will be in effect!!!

Instead of mandatory full compliance with all the new rule requirements BY 09-23-2013 — a full year “grace period” will granted, delaying such full compliance until September 23, 2014!!!

As long as those “basic” Agreements which were in place by or before 01-25-2013 the reprieve from full compliance with the new rules will stay in place AS LONG AS the BAA’s are not changed or renewed before the end of the extended “grace period.”

If you don’t have a “basic” HIPAA-compliant agreement in place with your Business Associate by 01-25-2013, the full weight of the new rules will be in effect, and force your compliance on 09-23-2013.

This extension IS CRITICAL – to many organizations who are short on staff, time and money – an extra year to put policies and procedures in place is INVALUABLE!!!

Because we truly care about our clients and the industry we are posting BOTH:
1 – The “basic” model of BAA posted by CMS/HHS several years ago;


2– Our own BAA, which we have used for years – this form is comprehensive and generally applies between a Covered Entity and a Business Associate – but – if needed it could be easily modified to apply between BA’s and their Subcontractors (modifications are up to the end users!)

Exclamation     Because we have never posted one of our “forms” we feel that we must explain the following: This form is given free of charge and IN NO
WAY WHATSOEVER  implies or should be considered as legal advice – or the establishment of legal representation period – it
is subject to all limitations below!

Read Below Before Downloading!

No warranties of any form or sort – express or implied  – are given with this form – this means IN NO manner, variation, or theory is any sort of guarantee or warranty included with this form whatsoever!

By downloading either form mentioned here the person or entity downloading this form IS AGREEING ALL of the Following:

The form is in no way guaranteed for accuracy, content, suitability, or even usefulness –

YOU AGREE also that you are downloading it at your own risk, and the result will be as if you had picked this up off of a street corner where someone left it –

You Agree Pearson & Bernard PSC – nor any of its partners or associates are in any way responsible for your use of either document; that Pearson & Bernard PSC cannot and will not ever be responsible for how you use either document – and that neither is legal advice or in any way legal representation!

1.  To download a Microsoft Word Document version of CMS “example” click –> CMS SAMPLE Business Associate Contracts
(this was copied and pasted from CMS website into a blank word document)

2.  To download a Microsoft Word Document example version of “our” (this Firm’s) BAA click –> Blank Example BAA


NEW HIPAA / HITECH Rules for Business Associates and Subcontractors

HHS Building 320x213

On January 17, 2013 the Dept. of Health and Human services (HHS) released a new final rule which made significant changes in various parts of the HIPAA/HITECH rules. As most readers know the pressures of protecting patients’ “protected health information” (PHI) are continually escalating. In some respects the new rule relieves the Covered Entities from some of those pressure.

How? By expanding the rule to make Business Associates, and their “sub-contractors” directly liable for ensuring the proper measures of security are in place to protect PHI. Naturally, the 563 page final rule has numerous topics and issues for the entire industry. But, in the short-term we need to call attention to the fact that essentially Business Associates must get assurances from their subcontractors! What assurances? Basically, assurances that the subcontractors (those who have “access” to PHI held by the Business Associate) will comply with the regulations and rules surrounding the use/disclosure/transmittal of PHI.

How about an example to clarify this:

A law firm (lets call them Firm) is a business associate of a covered entity (lets call them Agency).

So Firm and Agency have a business associate agreement (BAA) in place, and they have had it in place for years, because both Firm and Agency are doing their best to be compliant.

Prior to this new final rule, Firm had a responsibility to Agency to safeguard Agency’s PHI through the various requirements of the BAA. There was no “rule” requiring Firm to set up subsequent BAA’s with its subcontractors.

Now the new final rule requires Firm to set up BAA’s with its subcontractors.

Which subcontractors does Firm need to do this with?

Simply put, anyone  the Firm has hired as subcontractor if that subcontractor has access to PHI kept by the Firm. The new rule has published various comments about how expansive this requirement is, but boiled down to the bare essence of the matter, if the subcontractor has access to PHI there needs to be a BAA in place between Firm and subcontractor.

A prime example would be the Firm’s IT contractor. If Firm has hired someone (not an “in-house” employee) to manage its server and the Firm’s server has PHI, then the IT contractor access to PHI (assuming Firm has stored some PHI from Agency on its server).

Hopefully that plain “bare-essentials” example helped clarify this issue.

Quite notably, a short part of the new rule echos what is written above, it states:

“The Department also believes that the privacy and security protections for an
individual’s personal health information and associated liability for noncompliance with
the Rules should not lapse beyond any particular business associate that is a
subcontractor. Thus, under the final rule, covered entities must ensure that they obtain
satisfactory assurances required by the Rules from their business associates, and business
associates must do the same with regard to subcontractors, and so on, no matter how far
“down the chain” the information flows.”

This new final rule will become effective on March 26, 2013. Covered entities and business associates must comply with the rules by September 23, 2013. We will continue to review and examine the 563-page final rule we will continue to post relevant updates accordingly.

For anyone interested the  pdf document of the new final rule can be accessed by clicking here.

Paying Your Marketers Properly – Revisiting the Rabbit Hole

© 2012 Paul Hirsch

Update: 12-06-2012 – This Article Series is not forgotten, it is still “in-the-works!” In our desire to compile an authoritative basis for our opinion on this matter we are still reviewing a massive amount of documents, from Legislative History of Congress all the way to state court litigation documents which address this topic. We have read most of it and have “digested” what we have read. However the creation process is taking a backseat to ongoing litigation. We are simply waiting for things to slow down a bit before we delve into writing this article series – after all client needs come first!

Of course, if you have specific questions about a current situation or questions about what you want to do in terms of your marketing approaches, we are more than willing to advise you on a particular circumstance! If in doubt – ASK US!-

Paying Your Marketers Properly – Revisiting the Rabbit Hole

Introduction – Part 1 (of 5)

marketingAfter updating our website recently we have noticed that our article “Paying Your Marketers – Properly” and the issues covered within it have spurned many questions and comments both here on our site and from some of our clients. The health care industry is an ever-changing world, subject to ebb and flow of legislation, agency rules / regulations, court decisions and an ever-changing labor pool. Notably, Liz wrote this article almost ten years ago!

Many changes have occurred throughout the health care industry since the original article was written. Government agencies charged with oversight of the industry and its participants work differently then they did ten years ago. In fact, almost every facet of the industry has been affected by continual changes in the laws, rules, and regulations governing how agencies do business in this marketplace. It follows that the issue of paying marketers has changed also. Ultimately the crux of the original article remains in place, but none-the-less it deserves a fresh analysis.

One illustration of this change can be seen in the government’s focus (both on the state and federal levels) on strengthening and enforcing the prohibitions on fraud and abuse within the industry. The government’s new resolve in combating fraud and abuse has developed throughout many areas. One of the most visible examples of this new focus and resolve is the DOJ-HHS’s HEAT strike-teams, which actively combines and focuses the intelligence and resources of federal and state agencies towards the single inexorable goal of prosecuting businesses and people involved in Medicaid and Medicare fraud and abuse.

Moreover, beyond the health care industry itself, almost every industry (including health care) and every business, across the country, faces the perils and pitfalls of the changing environment of employer / employee relationships and employment laws. Federal and state agencies have promulgated new rules and regulations, and have adapted their methods and strategies in dealing with employment law. The “old-hat” areas of discrimination, retaliation, and harassment are as much of a concern as ever. However as technology advances and permeates the fabric of our society new questions are being raised such as: When can you run a criminal background check on a prospective employee? Can you ask a potential employee for their password to social media websites so you can better evaluate them? What are the limits you can place on employees’ use of social media both on the clock and off the clock (there is a surprising amount of controversy in this area particularly!)?

So how does all of this effect marketing strategies and payment structures for marketers in the health care industry?

In some ways many things are unchanged, but unfortunately that is not the whole story. Certain recent developments in the health care industry and employment law should give pause to health care providers when they decide to start or continue with marketing strategies and payment structures.

We have decided to start a multi-part series of articles which will shed new light on some old concepts, highlight certain techniques and approaches to structuring marketer training and payment, identify emerging issues and areas of concern, and suggest “functional adaptation methods” which can help health care businesses avoid potential pitfalls.

Please note: Many of the emerging issues about social media and employment law could be entire articles in and of themselves. So, this series will touch on some points of these emerging issues, but if there is interest in a more in-depth look we will consider putting together an article on these issues themselves.

Here are the planned segments:

Part 1: Introduction

Part 2: Health Care Laws (Anti-kickback and other federal rules & – Employee vs. Independent Contractor considerations)

Part 3: Employment Laws ( Fair Labor and Standards Act (FLSA) – wages paid and hours worked – payment structures – necessary documentation)

Part 4: Emerging Concerns

Part 5: “Functional Adaptation Methods” ®

(Please note regarding the phrase “functional adaptation methods:” some people might be looking for “best practices,” however we detest this catch phrase and purposefully choose to avoid it. As many successful business people can attest this phrase is one of the general corporate ear candy catch phrases which are in vogue. At the outset, this phrase in particular tends to over-simplify complex issues, because what might be best a best practice in one instance might not be what is best for every situation.)

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