CLIENT UPDATE

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March 10, 2010

Law Requires Employers to Provide Notice of Availability of Group Health Plan Premium Assistance

President Obama recently signed into law the Children’s Health Insurance Program Reauthorization Act of 2009 (“CHIPRA”). CHIPRA reauthorizes and finances the Children’s Health Insurance Program (“CHIP”). Notably, the Act requires employers to provide employees notice of possible group health plan premium assistance available under state Medicaid and CHIP programs.

Employers who provide group health coverage to employees who reside in states that provide premium assistance must notify employees of the availability of premium assistance opportunities. Currently, premium assistance is available in forty states, including New York and New Jersey. The Department of Labor recently published a model notice (which is available for download at http://www.dol.gov/ebsa/) that employers may use to satisfy their notice obligations under CHIPRA. Employers must provide notice to employees by the latter of the following dates: (1) the first day of the first plan year after February 4, 2010; or (2) May 1, 2010. After this initial notice, employers must continue to provide it annually. Failure to comply with the CHIPRA notice requirements will subject employers to a civil penalty of $100 per day.

If you should have any questions regarding the CHIPRA notice requirements, or any other related issues, please contact us.