Employee Benefits Compliance

Illinois Consumer Coverage Disclosure Act (CCDA) Mandates Disclosure of Employer Health Plan Comparison to State Benchmark Plan

Illinois state capitol building

The Illinois Consumer Coverage Disclosure Act (the “CCDA”) requires all Illinois employers provide a disclosure to employees regarding how the employer’s group health plan compares to the state Essential Health Benefits (EHB) under the Illinois benchmark plan. This rule does not mandate offering Illinois EHB; rather, only to provide the disclosure. These disclosures are required upon hire, annually and upon request as of August 27, 2021.

It is the state of Illinois’s position that self-funded plans would still be subject to this mandate, despite the ERISA preemption rule that typically allows those plans to avoid nearly all state insurance mandates. It is likely this issue will be resolved through court challenges.

For full details on the Illinois CCDA, see the Illinois Department of Labor (the “ILDOL”) FAQs.

Disclose List Comparison of Illinois Essential Health Benefits

Employers must disclose a written list of the covered benefits included in the employer’s group health plan coverage in a format that easily compares those covered benefits with the essential health insurance benefits under the Illinois benchmark plan. Illinois has provided a form employers may optionally use.

Clarifications Welcome

  • Employee Definition.

The CCDA requires that the employer provide the list to all employees eligible for the coverage and does not specify Illinois employees.

  • ERISA Preemption.

CCDA may be preempted by ERISA, but the ILDOL takes the position it is not. Specifically, in its FAQs, the ILDOL states that “[b]ecause the Consumer Coverage Disclosure Act creates a benefits notification requirement for all Illinois employers, regardless of the type of insurance they provide, and does not mandate insurance provisions or otherwise have any direct impact on employer-provided group health insurance coverage, employers who provide self-insured plans and/or ERISA plans are subject to the provisions of the Act.”

An employer with a self-funded plan must successfully challenge the CCDA in court in order for self-insured plans to not be subject to potential penalties for noncompliance. Therefore, many self-insured employers may choose to just comply since the law is not that burdensome.

Method of Delivery

  • Email.
  • Website that an employee is able to access regularly.
  • May provide by hand-delivery in new hire/open enrollment materials.

Penalties 

The penalties range from $500 to $5000, depending on the number of employees, prior offenses, and specific factors defined in the CCDA.

Conclusion

Employers with any Illinois employees and any Illinois-based employer must familiarize themselves with this mandate. Work with your Leavitt Group representative for information needed to complete your disclosure. We are your Trusted Partners when it comes to all of your compliance and insurance needs. Subscribe to our news alerts to be reminded of important upcoming compliance deadlines and breaking news alerts.

Leave a Reply

Your email address will not be published.