Employers are responsible to provide notification of certain rights and options available to employees such as Summary Plan Descriptions (SPDs), WHCRA, Medicare Part D and more. With the introduction of the Affordable Care Act, there is an increased urgency to keep current and compliant. The Department of Labor is cracking down on noncompliance with increased audits and assigned fines. This article provides an overview of critical notifications, how they apply to your business, when they should be sent, and important steps to ensure compliance.
Most, if not all, employers have or will have notification obligations related to health and welfare benefits, FMLA, COBRA, pension plans, etc.Notification requirements are not static and are continually changing and evolving. Changes in regulations, legislation, benefits offered, number of employees, and business type drive notification requirements.
Medical Insurance Notifications
If you offer medical insurance to employees, you are obligated to provide several different notifications driven by things like:
- the type of coverage provided (does it include prescription drug coverage),
- provisions of the coverage (does it include maternity),
- the size of your workforce (over 20, over 50), and
- states in which you have facilities and workers.
The following notifications are required to be given to employees when medical insurance is offered:
- COBRA (Federal or State Mini)
- CHIP (Child Health Insurance Plan)
- MHPA (Mental Health Parity & Addition Equity Act). This only applies to employers with 50 or more employees.
- NMHPA (Newborns & Mothers Health Protection Act), if maternity coverage
- WHCRA (Women’s Health & Cancer Rights Act) if mastectomy & reconstruction coverage.
o HIPAA (Health Insurance Portability and Accountability Act) which includes Pre-existing Condition Exclusions, Certification of Creditable Coverage, and Special Enrollment Rights
o Summary Plan Description (SPD) &/or SPD Wrap
o SMM (Summary Material Modification)
o Wellness Program Disclosure
o SBC (Summary Benefits & Coverage)
CMS & MMA Notification
If your plan includes prescription drug coverage, you most likely need to comply with CMS (Center for Medicare & Medicaid Services) and MMA (Medicare Modernization Act) reporting requirements, which includes two notification obligations. The first is a disclosure notice to all Medicare eligible individuals covered under the prescription drug plan, and the second is an online disclosure to CMS.
If you have 50+ employees who work within 75 miles of each other, the Family Medical Leave Act applies and all related FMLA notification requirements.
The Health Insurance Portability and Accountability Act applies to most organizations in one form or another, like the security and privacy of health data.
If in day-to-day operations you work with health information, other HIPAA notice requirements come into play, like data breach requirements. If there is a breach of confidential health data, a triggering HIPAA process and notice applies.
Each notification has established timelines or triggers by which employers need to provide notifications to employees and/or applicable agencies some annually and others by a certain due date. Many notifications like COBRA are trigger based driven by such things as termination of employment or other qualifying events. CMS and MMA reporting requirements have set dates of notification and triggering event notification criteria.
The disclosure notice to all Medicare eligible individuals who are covered under the prescription drug plan must take place:
- on or before November 15th of each year,
- prior to eligibility and enrolling in an employers’ plan,
- at open enrollment,
- upon request, and
- upon loss or change of creditable coverage.
The second notice to CMS, the online disclosure report of creditable coverage status of the prescription drug plan, should be completed:
- annually, no later than 60 days from the beginning of the plan year (i.e., renewal),
- within 30 days after termination of a prescription drug plan, or
- within 30 days after any change in creditable coverage status.
To be continued…. September 8, 2016