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New Notice Requirement of Group Health Plan Sponsor CHIPRA Premium Assistance

The Children’s Health Insurance Program Reauthorization Act of 2009 (“CHIPRA”) imposes certain notice requirements on employers maintaining group health plans.  Under CHIPRA, beginning in April 2009, employers sponsoring group health plans must provide notice of the new special enrollment rights CHIPRA affords. (See New Special Enrollment Rights Under Group Health Plans Effective April 1, 2009.)

DOL Publishes Model Notice

Under CHIPRA, the Departments of Labor (“DOL”) and Health and Human Services had to develop a model notice for employer-sponsors to use to inform each employee of certain premium assistance opportunities currently available in the employee’s state of residence.  On February 4, 2010, The DOL published that model notice (“Employer CHIP Notice”), available at http://www.dol.gov/ebsa/.  The Employer CHIP Notice is a word-processing format so that it can be updated and customized.

Who Must Receive Notice and When

The Employer CHIP Notice is to be provided to employees residing in a state that provides medical assistance under a state Medicaid plan or child health assistance under the state’s child health plan, regardless of where the employer is located or where the plan is insured (if insured).

Each employer sponsoring a group health plan must provide the Employer CHIP Notice to applicable employees beginning with the first plan year that starts after February 4, 2010 – i.e., January 1, 2011, for group health plans that are on the calendar year.  (If the plan year begins between February 4, 2010, and May 1, 2010, the initial Employer CHIP Notice must be provided by May 1, 2010.)  The Notice may be given to employees together with the group health plan’s eligibility and enrollment information, open enrollment packets, or summary plan description as long as it appears as a separate notice and in a way that ensures employees will appreciate its significance.

How Can Employers Meet Multiple State Requirements?

The Employer CHIP Notice need not be customized for each state.  Currently, 40 states offer one or more programs that provide state Medicaid assistance and/or state child health plan assistance.  Thus, it may be easier administratively for most employers with employees residing in multiple states to send the same notice to each employee, regardless of the state in which the employee resides (e.g., using the same notice nationwide), although the notice will be longer because it must include contact information for each state.  The DOL’s model notice is designed for nationwide use.

DOL Will Update Model Each Year

DOL states that it intends to update the model notice each year to reflect changes in contact information and the states offering state Medicaid assistance and/or state child health plan assistance.  Therefore, employers should plan to update the Employer CHIP Notice annually.

Jackson Lewis’ Employee Benefits, including Complex ERISA Litigation, Workplace Privacy and Executive Compensation practice group has in-depth experience in assisting employer to comply with group health plan and other welfare plan requirements.  Our attorneys work in all regions of the country to assist employers with their specific needs.