The Illinois Department of Labor has issued a set of FAQs clarifying many of the questions related to the new state law called the Consumer Coverage Disclosure Act (CCDA).
As a reminder, all employers that provide group medical coverage to any number of employees in Illinois, even if the employer is located outside of Illinois, are now required to give a comparison of the plan’s coverage benefits against the state benchmark’s essential health benefits (EHBs) as listed under the chart provided by the Illinois Department of Labor.
The disclosure must list which EHBs are or are not covered by the employer’s group medical plan. Employers are not required to use the chart provided, but the disclosure must include clear information about the EHBs covered or not covered by the employer group health plan.
Importantly, the CCDA does not impose any coverage requirements on employers, only disclosure requirements.
If an employer sponsors a self-funded plan, the FAQs state that the disclosure requirement is imposed on employers with Illinois employees, regardless of the type of group insurance offered (fully-insured vs self-insured). Thus, the Illinois Department of Labor takes the position that “employers who provide self-insured plans and/or ERISA plans are subject to the provisions of the Act.” Employers who feel as though they do not need to comply should consult with legal counsel.
Penalties for non-compliance can range from $500 to $5,000, depending on the size of the employer and the gravity of violations. However, employers may first receive a 30-day notice to correct any failures.
Therefore, employers with employees residing in Illinois should review the FAQs and the Illinois DOL’s EHB benchmark chart, and contact their TPAs and/or carriers for assistance in completing the necessary information. Once completed, employers must give the information to employees upon hire, annually at open enrollment, and upon request. It may be posted on a website that employees can regularly access or sent via email.
If you have any questions, please reach out to your trusted advisors at Hausmann Group.
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