C&D Labor and Employment Advisory

Legal Authority for Notice Requirement:  Under various federal laws, an employer that maintains a group health plan in a State, such as Oklahoma, that provides a health insurance premium assistance program for the purchase of coverage under a group health plan is required to make certain disclosures to employees.  Originally, there was no clear guidance on the form or content of the required disclosures.

However, on February 4, 2009, President Obama signed the Children's Health Insurance Program Reauthorization Act of 2009 ("CHIPRA") which includes a requirement that the Department of Labor ("DOL") and the Department of Health and Human Services ("DHHS") develop a model notice for employers to use to inform employees of potential opportunities currently available in the State in which the employee resides for group health plan premium assistance under Medicaid and the Children's Health Insurance Program ("CHIP"). 

Model Notice Released: Exactly one year after CHIPRA was signed by President Obama, on February 4, 2010, the DOL and DHHS released guidance regarding the content of the notice and a template model employer notice ("Model Notice").  The Model Notice is available in modifiable, electronic form on the DOL's website.  

Content of Notice:  The Model Notice is very generic and basically includes a list of States which provide qualifying premium assistance programs and contact information to find out more about such programs.  The Model Notice is most appropriate for employers with employees in multiple states.  However, the instructions accompanying the Model Notice specifically permit employers to modify the Model Notice and include more details regarding the State premium assistance program.  Specifically, the DOL's instructions state: "An employer which is not facing multi-State complexities and who wants to provide more comprehensive State-specific information to its workforce may modify the [Model Notice] to its employees."  At a minimum, employers are required to include at least the relevant State contact information where employees can obtain more details about the State's premium assistance program.

Insure Oklahoma Program:  The Oklahoma premium assistance program is referred to as Insure Oklahoma.  Information about it can be obtained on its website.  Basically, employees who participate in Insure Oklahoma save on health insurance premiums provided by their employer by receiving subsidies through Insure Oklahoma.   A qualified employee pays no more than 15 percent of the premium.  The employer payers 25 percent and Insure Oklahoma pays the remaining 60 percent.  Eligibility depends on the income generated by the employee and his/her family and the number of dependents.  For example, in 2009, the income limit for a family of four with two workers who are both employed was $49,860. 

Timing and Delivery of the Notice:  Employers are required to provide the notices by the date that is the later of (a) the first day of the first plan year after February 4, 2010; or (b) May 1, 2010.  Accordingly, for plan years beginning between February 4, 2010 through April 30, 2010, the employer CHIP notice must be provided by May 1, 2010.  For employers whose next plan year begins on or after May 1, 2010, notice must be provided by the first day of the next plan year (January 1, 2011 for calendar year plans).  The notice is not required to be provided in a separate mailing.  Plans may combine information to reduce administrative costs.  Accordingly, an employer may provide the notice concurrent with other materials (including, for example, enrollment packets, open season materials, or the plan summary plan description).  

If you have any questions about providing the premium assistance notice to your employees or would like assistance in modifying the model notice to better accommodate the needs of your workforce, please contact Cori H. Loomis, Director, Crowe & Dunlevy.

This document is provided by Crowe & Dunlevy, P.C. for educational and informational purposes only and is not intended and should not be construed as legal advice.