Utah Compliance Connection - April 2025

Federal Compliance Update

DOL Releases Updated Model Employer CHIP Notice

The Department of Labor (DOL), through its Employee Benefits Security Administration (EBSA), has released a new model  Employer CHIP Notice with information current as of March 17, 2025.

As a reminder, the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) imposes an annual notice requirement on employers that maintain group health plans in states that provide premium assistance subsidies under a Medicaid plan or a Children’s Health Insurance Plan (CHIP). An employer can choose to provide the notice on its own or concurrent with the furnishing of:

• Materials notifying the employee of health plan eligibility;
•  Materials provided to the employee in connection with an open season or election process conducted under the plan; or
• The summary plan description (SPD).

Covered Employers

An employer is subject to this annual notice requirement if its group health plan covers participants who reside in a state that provides a premium assistance subsidy, regardless of the employer’s location.

The DOL’s model notice, which employers may use for this disclosure, is updated periodically to reflect changes in the states that offer premium assistance subsidies. The DOL’s model Employer CHIP Notice includes information current as of March 17, 2025. Employers could also choose to prepare their own notices, or modify the model notice. Employers should be sure to include at least the minimum relevant state contact information for any employee residing in a state with premium assistance.

CHIPRA Notice Requirements

• Employers that maintain group health plans in states with premium assistance subsidies must provide their employees with an annual notice.
• The DOL has a model notice for employers to use.

Employers could also choose to prepare their own notices, or modify the model notice.

Form 5500 Deadline is July 31 – Are You Required to File?

Each year, employers that are subject to the Employee Retirement Income Security Act of 1974 (ERISA) must electronically file an annual report (Form 5500) for each employee benefit plan they maintain unless a filing exemption applies.

Employers with employee benefit plans that operate on a calendar year basis must file their annual reports for 2024 with the

U.S. Department of Labor (DOL) by July 31, 2025. An employer may extend this deadline by 2.5 months (until Oct. 15, 2025) by filing Form 5558 with the IRS by July 31, 2025.

Small welfare benefit plans (fewer than 100 covered participants) that are unfunded or fully insured (or a combination of unfunded and insured) are exempt from the Form 5500 filing requirement. However, all employers who adopt and sponsor  a retirement plan governed by ERISA must file a version of the Form 5500 annually with the DOL regardless of the  number of covered participants.

Voluntary Compliance

The Delinquent Filer Voluntary Compliance Program (DFVCP) was created by the DOL to encourage plan administrators to voluntarily file overdue Forms 5500. The DFVCP gives delinquent plan administrators a way to avoid potentially higher penalty assessments by voluntarily completing their late Form 5500s for a year and paying reduced penalties. Plan administrators are eligible to use the DFVCP only if they make the required filings prior to being notified in writing by the DOL of a failure to file a timely annual report.

2025 Penalties

• The DOL can assess penalties for noncompliance with the annual reporting requirements, including submitting incomplete Forms 5500 or not filing Forms 5500 by the due date.
• The DOL has the authority under ERISA to assess penalties of up to $2,739 per day for each day an administrator fails or refuses to file a complete Form 5500.
• The penalties may be waived if the noncompliance was due to reasonable cause.
• Higher penalty assessments may be avoided for plan administrators that use the DFVCP.

Action Steps

Employers with calendar year plans that do not qualify for a filing exemption should work with their service providers to electronically file the Form 5500 (including required schedules and attachments) using the DOL’s EFAST2 electronic filing  system by July 31, 2025.

Employers that need extra time should file Form 5558 by July 31, 2025. As of Jan. 1, 2025, Form 5558 can be filed electronically through EFAST2 or can be filed on paper with the IRS.

State Compliance Update

Nothing to report for this month...

Compliance Calendar

May

Nothing so far…

June

6/2 – Prescription Drug Data Collection Reporting – group health plans and health insurers are required to submit data regarding drug costs to the Department of Treasury, Department of Labor (DOL) and Health and Human Services (HHS). Reporting is due annually on June 1st, or the first business day after, if June 1st falls on a weekend day or holiday.

July

7/31 – Form 5500 Filing Deadline (Calendar year Plans) 7/31 – Form 941 Filing Deadline (Second Quarter)

7/31 – PCORI Fee Deadline

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