EBN has included the best discussion I have yet found on the non-discrimination provisions of PPACA relating to carveout's. Kudos to Vanessa Scott for getting it right.
The Internal Revenue Service recently issued Notice 2011-1 regarding the application of the nondiscrimination rules under Internal Revenue Code (Code) section 105(h) to non-grandfathered insured group health plans pursuant to the Patient Protection and Affordable Care Act.According to the Notice, the IRS will not require insured plans to comply with nondiscrimination rules until further guidance has been issued. Furthermore, to allow insured plans adequate time to comply with the rules, it is likely that future guidance will not apply until plan years beginning at some time after the date that the guidance is issued.I personally feel that every federal worker or citizen who exposes an instance where federal regulations lead to confusion, job loss, higher costs and havoc being wrought on the citizens should get a free uh oh! hat. The initiative would be privately funded of course lest we bankrupt the Treasury. By the time the superbowl was played the entire stadium could be filled with patriotic hats.
Thus, plan sponsors will not be required to pay excise taxes associated with noncompliance with the nondiscrimination requirements until then. The Notice also requested comments on a number of issues that may be addressed in future guidance.