Compliance FYI: Annual Notice Requirements

Compliance, Employee Benefits

For plan sponsors/employers, open enrollment is the perfect time to share required annual enrollment notices with plan participants/employees. Below is a list of notices that plan sponsors should provide in open enrollment materials or ensure that the carrier/TPA is providing them.

Provided by Carrier/TPA (confirm with Carrier/TPA)

  • Disclosure of “Grandfathered” Status – Any grandfathered plans must include a statement indicating its status as such in any materials describing benefits.
  • Disclosure of Patient Protections: Choice of Providers – A non-grandfathered plan that requires designation of a primary care provider (PCP) must provide notice of the right to choose a PCP, pediatrician, or network provider specializing in OB-GYN care. Notice must be provided with the Summary Plan Description or other description of benefits.
  • Summary of Benefits and Coverage (SBC) – Plans must provide a summary, not to exceed four double-sided pages, of plan benefits, coverage and cost-sharing arrangements, including exceptions, reductions, limitations and continuation of coverage information. Notice must be provided to all participants and beneficiaries annually with open enrollment materials, or if a plan does not conduct open enrollment, 30 days prior to the start of the plan year. Employers should check to see if the carrier/TPA provides the document directly to participants. If not, it is the employer’s responsibility.

Provided by Plan Sponsor in Open Enrollment Materials

  • Women’s Health and Cancer Rights Act (WHCRA) – Description of benefits under WHCRA and any deductibles and coinsurance limits applicable to such benefits. Sent to participants and beneficiaries upon enrollment, and annually thereafter.
  • CHIPRA Notice to Employees – Employers that maintain a group health plan in a state that provides premium assistance under Medicaid or CHIP must notify all employees of potential opportunities for premium assistance in the state which the employee resides. To be sent to all participants and beneficiaries annually by the first day of the plan year. A sample notice is available from the DOL.
  • HIPAA Notice of Special Enrollment Rights – Notice to participants of HIPAA special enrollment rights upon acquiring a new dependent or loss of other coverage. To be sent to all participants on or before participant is offered the opportunity to enroll in a group health plan.
  • HIPAA Notice of Privacy Practices – Notice to self-funded plan (medical, dental, FSA, HRA) plan participants regarding the plan sponsor’s adherence to HIPAA privacy and security requirements. Must be provided to new enrollees and once every three years.

Additional Notices – Wellness (must be provided prior to participation)

  • Wellness Program Disclosure (HIPAA) – Wellness programs that provide a financial incentive to participants that meet a standard related to a health factor are governed by HIPAA. Health contingent plans may provide a reward for being tobacco free or participating in a weight loss program. HIPAA requires that a notice explaining the availability of an alternative reasonable standard be provided to individuals eligible to participate in the wellness program. The notice explains how an individual may seek the alternative standard.
  • Wellness Program Disclosure (ADA) – Wellness programs that require participants complete a health risk assessment (HRA) or biometric screening in order to qualify for a financial incentive are governed by the Americans with Disabilities Act (ADA). The ADA requires that wellness program participants receive this notice before providing health information. Employers are not required to use the exact language within the DOL Model Notice, but it must include the following information:
    • What information will be collected,
    • Who will receive it,
    • How it will be used, and
    • What will be done to keep information confidential.

Additional Notices – CMS Creditable/Non-Creditable Coverage Notice

  • Creditable/Non-Creditable Coverage Disclosure Notice to Plan Participants – Plans must provide disclosure to health plan participants regarding the status of the plan’s prescription drug coverage: creditable = covers as much as Medicare Part D; non-creditable = does not cover as much as Medicare Part D. The Notice(s) must be provided at the following times:
    • Prior to October 15 each year (before Medicare Part D Open Enrollment)
    • In new hire enrollment materials
    • Change in status from creditable to non-creditable or vice versa
  • Creditable Coverage Disclosure Notice to CMS – Plans must provide disclosure to CMS stating whether a group health plan’s prescription drug coverage is, on average, at least as good as standard prescription coverage under Medicare Part D. Filed with CMS through online form, annually, within 60 days of the beginning of the plan year.

Key Takeaway:

The task of providing annual notices to plan participants can be challenging. If you have questions, or wish to see samples of any of the above discussed notices, please contact your M3 account representative.

Created: 11/14/16; Updated: 1/06/18; 9/14/20; 9/15/21; 9/15/22; 9/12/23

The information provided is a summary of laws and regulations relating to employee benefit plan compliance. This information should not be construed as legal advice. In all cases, employers should consult with their own legal counsel.

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