DOL Publishes Model CHIPRA Notice
“The Department of Labor ("DOL") recently issued a model notice that can be used by employers to fulfill their notice obligations under the Children's Health Insurance Program Reauthorization Act of 2009 ("CHIPRA").”
The Department of Labor ("DOL") recently issued a model notice that can be used by employers to fulfill their notice obligations under the Children's Health Insurance Program Reauthorization Act of 2009 ("CHIPRA"). CHIPRA extended and expanded the Children's Health Insurance Program ("CHIP") to allow states to subsidize the premiums for employer-provided group health coverage for eligible children and their families. In addition to requiring group health plans to offer new special enrollment opportunities to certain employees and their dependents who are eligible for, but not enrolled in, a group health plan, CHIPRA also requires that employers offering such a group health plan, in states that provide subsidized premiums, to notify employees residing in each such state of the potential opportunities available in that state for premium assistance under Medicaid and CHIP for health coverage of the employee and/or the employee's dependents.
CHIPRA requires that an employer provide notice of the potential opportunity for premium assistance to employees residing in states that provide premium assistance programs; however, the employer may send the notice to all employees, regardless of whether the employees' state of residence offers such a program, for sake of administrative ease. Approximately 40 states offer one or more such premium assistance programs, including California, Florida, New Jersey, New York and Virginia.
The model notice issued by the DOL meets CHIPRA's basic content requirements, including a very brief description of the premium assistance available and contact information for each state's specific program descriptions, and may be used by employers nationwide. Employers may choose to modify or supplement the DOL's model notice, but must still include the relevant state contact information as required by CHIPRA. The model notice issued by the DOL must be provided by the date that is the later of (a) the beginning of the first plan year that begins after February 4, 2010 or (b) May 1, 2010. Therefore, group health plans with a calendar plan year are required to provide the notice by January 1, 2011, while group health plans with a plan year beginning between February 4, 2010 and April 30, 2010, must provide the notice by May 1, 2010.
Employers are not required to send the CHIPRA notice separately; they may include the notice in a single mailing along with other plan-related materials, such as open enrollment materials or the group health plan summary plan description, so long as (a) such materials are provided by the notification deadline discussed above, (b) such materials are provided to all employees entitled to receive the CHIPRA notice and (c) the CHIPRA notice appears separately and in such a manner that employees receiving the notice could reasonably be expected to appreciate its significance.
The CHIPRA notice must be provided annually and free of charge; it may be sent by first-class mail or, alternatively, may be sent electronically to the extent the DOL's electronic disclosure safe harbor rules are met. Failure to comply with CHIPRA's notice requirements may result in penalties of up to US$100 per day, per violation, with respect to each affected employee.
Additional CHIPRA Requirements
Note that, in addition to CHIPRA's notice requirement, CHIPRA also requires group health plans to provide, upon request, information about their benefits to state Medicaid or CHIP programs in order for states to determine whether premium assistance is a cost-effective way to provide medical coverage. Although the DOL has not yet released the model coverage coordination disclosure form that would satisfy such disclosure requirements, states may begin requesting such information beginning with the first plan year that begins after February 4, 2010.
Material appearing herein may be reproduced or translated with appropriate credit. Due to space limitations and the general nature of its content, this information is not intended to be and should not be regarded as legal advice.
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