Compliance Confidence
Annual Adjustments of Civil Monetary Penalties for 2022
Annual Adjustments of Civil Monetary Penalties for 2022
The Department of Labor (DOL) issued its 2022 annual adjustments of civil monetary penalties for benefits-related violations for employer-sponsored plans.
These annual penalty adjustments are derived from The Inflation Adjustment Act, which requires the DOL and other federal agencies to annually adjust their civil penalty levels for inflation no later than January 15 of each year. The 2022 adjustments apply for penalties assessed on or after January 15, 2022, for Employee Retirement Income Security Act (ERISA) violations occurring after November 2, 2015.
Additionally, the Department of Health and Human Services (HHS) announced another update for annual adjustments of civil monetary penalties that affect employer-sponsored plans within its jurisdiction. These adjustments are effective for penalties to assess on or after March 17, 2022, for violations occurring on or after November 2, 2015.
| ERISA | 2021 | 2022 |
|---|---|---|
| Failure to Provide Secretary of Labor Requested Documentation | $161 per day not to exceed $1,613 per request | $171 per day, not to exceed $1,713 per request |
| Failure to File Form 5500 | $2,259 per day | $2,400 per day |
| Failure to File Annual Form M-1 for Multiple Employer Welfare Arrangements (MEWAs) | $1,644 per day late | $1,746 per day late |
| Failure to Timely Distribute Summary of Benefits and Coverage (SBC) | $1,190 per failure | $1,264 per failure |
| Genetic Information Nondiscrimination Act (GINA) Violation | $120 per day | $127 per day |
| Failure to Provide Notice and Information Regarding the Children’s Health Insurance Program (CHIP) | $120 per day | $127 per day |
| HIPAA | 2021 | 2022 |
|---|---|---|
| Tier 1: Lack of Knowledge | Min: $120 Max: $60,226 Year Cap: $1,806,757 |
Min: $127 Max: $63,973 Year Cap: $1,919,173 |
| Tier 2: Reasonable Cause and Not Willful Neglect | Min: $1,205 Max: $60,226 Year Cap: $1,806,757 |
Minimum: $1,208 Max: $63,973 Year Cap: $1,919,173 |
| Tier 3: Willful Neglect, Corrected Within 30 Days | Min: $12,045 Max: $60,226 Year Cap: $1,806,757 |
Min: $12,794 Max: $63,973 Year Cap: $1,919,173 |
| Tier 4: Willful Neglect, Not Corrected Within 30 Days | Min: $60,226 Max: $1,806,757 |
Max: $63,973 Year Cap: $1,919,173 |
| Medicare Secondary Payer | 2021 | 2022 |
|---|---|---|
| Offering incentives to Medicare-eligible individuals not to enroll in a plan that would otherwise be primary | $9,753 | $10,360 |
| Responsible reporting entities failure to provide information identifying situations where the group health plan is primary | $1,247 | $1,325 |
| Willful or repeated failure to provide requested information regarding group health plan coverage | $1,588 | $1,687 |
For a complete list of the DOL annual adjusted penalties, please refer to the Federal Register by clicking here. HHS annual adjustments can be found here.
The penalties above relate to a wide range of compliance issues, but not all violations will give rise to the highest permitted penalty. The DOL still has discretion to impose lower penalties, such as the delinquent filer voluntary compliance program (DFVCP), which is designed to encourage Form 5500 filings. Taking the proper steps to avoid these penalties is important even if the DOL offers ways to lower penalty amounts. The penalty amounts can add up quickly and provides a strong incentive for employers to remain in compliance.
Never miss an update – bookmark OneDigital’s Compliance Confidence blog for the latest developments on employer compliance. As always, if you have more questions, please reach out to your OneDigital consultant.
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