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Affordable Care Act Information Reporting

DOL Announced 2024 Compliance Errors Penalties

On March 6th, the DOL announced 2024 Compliance Error Penalties. Since 2015, federal agencies have been required to annually review the laws and regulations they enforce to adjust applicable penalties for inflation. These adjustments, or so the theory goes, provide higher incentives for plan sponsors to ensure their benefit plans and programs remain compliant. Specifically, the U.S. Department of Labor (DOL) must adjust penalties under the Employee Retirement Income Security Act (ERISA) annually.

Action steps
To avoid penalties, employers should review their health plans to ensure compliance with ERISA’s requirements. Specifically, employers should ensure they are complying with ERISA’s reporting and disclosure rules, including Form 5500, annual CHIP notice, and SBC requirements.

Adjustments for 2024
When the DOL announced 2024 Compliance Error Penalties, they decided that failure or refusal to file an annual report (Form 5500) with the DOL (unless a filing exemption applies)
  • 2023 Penalty: Up to $2,586/day
  • 2024 Penalty: Up to $2,670/day
Failure of a multiple employer welfare arrangement (MEWA) to file an annual report (Form M-1) with the DOL
  • 2023 Penalty: Up to $1,881/day
  • 2043 Penalty: Up to $1,942/day
Failure to furnish plan-related information requested by the DOL
  • 2023 Penalty: Up to $184/day, not to exceed $1,846/request
  • 2023 Penalty: Up to $190/day, not to exceed $1,906/request
Failure to provide the annual notice regarding Children’s Health Insurance Program (CHIP) coverage opportunities (applies to employers with group health plans that cover residents of states that provide a premium assistance subsidy under CHIP)
  • 2023 Penalty: Up to $137/day/failure (each employee is a separate violation)
  • 2024 Penalty: Up to $141/day/failure (each employee is a separate violation)
Failure to timely disclose information to a state regarding group health plan coverage for an individual who is covered under a Medicaid or CHIP plan
  • 2023 Penalty: Up to $137/day (each participant or beneficiary is a separate violation)
  • 2024 Penalty: Up to $141/day (each participant/beneficiary is a separate violation)
Failure by any health plan sponsor (or any health insurance issuer offering health insurance coverage in connection with the plan) to comply with requirements of the Genetic Information Nondiscrimination Act (GINA) for health plans
  • 2023 Penalty:
    • $137/day/participant or beneficiary during noncompliance period
    • Minimum of $3,439/participant or beneficiary for de minimis failures not corrected prior to notice from the DOL
    • Minimum of $20,641/participant or beneficiary for failures not corrected prior to notice from the DOL that are not de minimis
    • Maximum of $688,012 for unintentional failures
  • 2024 Penalty:
    • $141/day/participant or beneficiary during noncompliance period
    • Minimum of $3,550/participant or beneficiary for de minimis failures not corrected prior to notice from the DOL
    • Minimum of $21,310/participant or beneficiary for failures not corrected prior to notice from the DOL that are not de minimis
    • Maximum of $710,310 for unintentional failures
Failure to provide Summary of Benefits and Coverage (SBC)
  • 2023 Penalty: Up to $1,362 per failure to provide the SBC
  • 2023 Penalty: Up to $1,406 per failure to provide the SBC