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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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