Benefits Buzz

New Disclosure Requirement for Illinois Employers

Posted on December 3rd, 2021

On August 27, 2021, the State of Illinois passed a law called the Consumer Coverage Disclosure Act (CCDA). The CCDA requires a new written disclosure to be provided by every employer who has employees in the State of Illinois and who also provides group health insurance coverage to its employees.

The new disclosure must “provide all employees eligible for the coverage a written list of the covered benefits included in the group health insurance coverage in a format that easily compares those covered benefits with the essential health insurance benefits required of individual health insurance coverage regulated by the State of Illinois.”

The State of Illinois wants employers to provide more transparency around the coverage that is being offered to employees. Some employer plans may be regulated by other states that have different essential health insurance benefit requirements. Additionally, large group health plans and self-funded plans are not required to cover all essential health insurance benefits. This disclosure is intended to help employees determine if they should enroll in coverage through their own employer’s plan, in the individual market, or elsewhere.

The new disclosure is required by employers of any size and regardless of whether the group health insurance coverage is fully insured or self-insured. The disclosure is required upon hire, annually, and upon request. The disclosure may be provided by email or posted on a website that is regularly accessed by employees.

The Illinois Department of Labor (IDOL) recently published additional information on their website to help employers comply with this new requirement. Included on the website is the following information:

Employers will need to keep records of their disclosures for one year. If audited by the IDOL and proof of the disclosure cannot be provided, financial penalties may apply. However, employers will have 30 days to come into compliance before any financial penalty will apply. Penalties can range between $500-$5,000 per offense.

The law has an immediate effective date so employers should be looking to provide this new disclosure as soon as reasonably possible.

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