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Got a question? Try Ask the MMA Are municipalities liable for the Free Rider Surcharge?
Q: Certain employers whose employees and dependents receive health services through the Uncompensated Care Pool may be subject to a surcharge (the Free Rider Surcharge). Will my municipality be liable for that surcharge?
A: While the Division of Health Care Finance and Policy has not yet issued regulations that define the Free Rider Surcharge, the agency stated on September 8 that the surcharge would apply only “to those employers who do not contribute to or arrange for their employees to have access to health insurance through a Section 125 plan.” The Health Care Reform legislation requires each Massachusetts employer with more than ten employees to “adopt and maintain a cafeteria plan that satisfies 25 U.S.C. 125 and the rules and regulations promulgated by [the Commonwealth Health Insurance Connector] and to file a copy of such plan with the connector.”
Answer provided by Paul Mulkern, an attorney who represents municipalities in the area of labor and employment law.
Got a question? Try Ask the MMA Are municipalities liable for the Free Rider Surcharge?
Are municipalities liable for the Free Rider Surcharge?
Q: Certain employers whose employees and dependents receive health services through the Uncompensated Care Pool may be subject to a surcharge (the Free Rider Surcharge). Will my municipality be liable for that surcharge?
A: While the Division of Health Care Finance and Policy has not yet issued regulations that define the Free Rider Surcharge, the agency stated on September 8 that the surcharge would apply only “to those employers who do not contribute to or arrange for their employees to have access to health insurance through a Section 125 plan.” The Health Care Reform legislation requires each Massachusetts employer with more than ten employees to “adopt and maintain a cafeteria plan that satisfies 25 U.S.C. 125 and the rules and regulations promulgated by [the Commonwealth Health Insurance Connector] and to file a copy of such plan with the connector.”
Answer provided by Paul Mulkern, an attorney who represents municipalities in the area of labor and employment law.
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