The Department of Labor (“DOL”) has released an updated Model Notice for employers to use to inform employees about their potential to receive state-provided premium assistance subsidies to use towards the purchase of group healthcare coverage.
The Children’s Health Insurance Program (“CHIP”) Reauthorization Act of 2009 requires employers that maintain group health plans to notify employees annually of the availability of premium assistance subsidies from state-administered Medicaid or CHIP programs. Employers must provide the Medicaid/CHIP Model Notice to all employees who reside in states that provide such assistance, regardless of whether the employees are currently participants in the employer’s group health plan.
Because the Medicaid/CHIP Model Notice lists the states that provide premium assistance, the DOL has said that an employer can meet its notification obligation by simply providing the Model Notice to all employees, regardless of where they live.
The Medicaid/CHIP Model Notice must be distributed annually by the first day of the plan year, and it may be combined with other compliance notices or enrollment materials. For this reason, it is commonly included in benefits guides and open enrollment materials. For 2025, the maximum penalty for an employer’s failure to provide its employees with the required Medicaid/CHIP Model Notice is $145 per day, per employee.
