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No SEP if coverage becomes unaffordable mid year?


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Employer offers a group health plan which renews 7/1 each year.

For first half of 2016 employer pays 100% of employee-only coverage, obviously affordable.

Effective 7/1/2016 employer reduces it's contribution to only 50% of self-only premium rendering the offer unaffordable for a significant number of employees.

Does this create a Special Enrollment Period allowing employees to apply for Marketplace coverage and subsidies?

SEP rules and calls to Marketplace indicate NO because the employer is still offering coverage although unaffordable.

SEP rules seem to permit access to Marketplace coverage only if employer terminates plan or completely terminates all employer contributions.

Doesn't seem right, particularly when you realize that if no employee can get a Marketplace subsidy the employer will also sidestep the employer shared responsibility penalty.

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