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Illinois Provides Additional Guidance on the Consumer Coverage Disclosure Act

On August 27, 2021, Illinois passed the  Consumer Coverage Disclosure Act  (Act), which requires a new disclosure be provided to Illinois-based employees.

The Act requires that any employer that provides group health insurance to Illinois-based employees provide a written list of covered benefits to the employees. It applies to all employers with Illinois-based employees, regardless of size and whether their plan is fully insured or self-funded. In issued FAQs, Illinois clarifies that the Act does not require employers to cover all of the essential benefits, merely to disclose whether or not their plan currently covers them.

To help employers comply with the law, Illinois has provided a form of Essential Health Benefits via a spreadsheet titled “List of Essential Health Benefits Regulated by the State of Illinois.” Employers can use this spreadsheet to compare the health benefits offered by their plan to the list of essential benefits that Illinois regulates.

Employers do not have to use the specific form provided by the State of Illinois. If an employer chooses a method other than the supplied form, a written list of covered benefits must be provided in a format that easily compares the group health plan’s covered benefits with the essential benefits regulated by the State of Illinois. Employers can provide the disclosure by email or posting on a company website that employees can regularly access. Illinois-based employees must be provided this disclosure when they are hired and at least annually. Employees can also request a copy at any time.

Employers must preserve records that the disclosure was provided for at least one year. Upon request from the Illinois Department of Labor, employers must show that each eligible employee received the required information. Employers have 30 days to comply before a penalty is applied. Failure to comply will result in the following penalties:

Type of Offense

Less than 4 employees in Illinois

4 or more employees in Illinois

First offense Up to $500 Up to $1,000
Second offense Up to $1,000 Up to $3,000
Every subsequent offense Up to $3,000 Up to $5,000

Violations are per employer, not per employee. If an employer has seven employees and each fails to receive a disclosure, the first offense would be up to $1,000.

If you have employees in Illinois, prepare to comply now. To learn more about how to ensure your business is compliant with new regulations, contact your OneDigital consultant.