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Opt-out Arrangements: Critical Considerations for Employers

Sep 24, 2017 8:43:33 PM / by Deborah Hyde posted in ACA, affordability, Affordable Care Act, Deborah Hyde, hr compliance, Front Page Post, opt-out payments, overtime pay, regular rate of pay

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An opt-out arrangement offered as part of a group health plan can provide significant advantages to employers. Through such an arrangement, employees who have alternative sources of coverage are incentivized to forego participation in the employer plan. In exchange for the waiver, the employee receives a (taxable) payment. However, recent developments - both regulatory and judicial - may undermine the effectiveness of opt-out arrangements in certain circumstances.

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