On February 4, 2009, President Obama signed into law the Children's Health Insurance Program Reauthorization Act of 2009 (the "Act"). The state children's health insurance program ("CHIP") provides health insurance for children whose families cannot afford private healthcare but do not qualify for federal Medicaid. The Act expands CHIP by providing additional special enrollment rights related to group health plan coverage. The new law also permits state subsidies of employer-provided group health premiums for eligible children and families and imposes new notice and disclosure obligations for employers that maintain group health plans.
New Benefits Provided to Employees
Beginning April 1, 2009, CHIPRA created new special enrollment rights to individuals a) that are newly eligible for assistance in paying health insurance premiums under an employer-sponsored group health plan or b) whose coverage under Medicaid or CHIP is terminated. Individuals must notify their employer within 60 days of the change ineligibility in order to exercise their special enrollment right. These special enrollment rights are available beginning on April 1, 2009 for all health plans, regardless of when they renew. This requirement applies to both fully-insured and self-funded group health plans.
Notice Obligations Imposed On Employers
Employers are required to update their special enrollment notices to include information about the availability of special enrollment rights provided under CHIPRA. Under ERISA, summary plan descriptions must be updated within 210 days of the plan’s amendment.
Employers are also obligated to issue new notices to all employees residing in a state that is funded by CHIP, including Wisconsin. This new notice will notify all employees (regardless of enrollment status) of potential opportunities for premium assistance. Employers must provide this notice on an ANNUAL basis on the later of: a) the first day of the first plan year after February 4, 2010 or b) May 1, 2010. (The May 1, 2010 deadline is applicable to plans that renewed 2/4/2010 through 4/30/2010.) For a copy of the model notice, see www.dol.gov./ebsa/pdf/chipmodelnotice.pdf.