HHS Issues Annual Adjusted Civil Penalties for MSP and SBC Violations

The Department of Health and Human Services (HHS) Office for Civil Rights (OCR) announced its final regulations adjusting civil penalties for annual inflation, which included increased penalties for violations under the Medicare Secondary Payer Rules and willful failure to provide a Summary of Benefits and Coverage. The regulations also adjusted penalties for violations under the Health Portability and Accountability Act (HIPAA), which is summarized in our previous blog. The following amounts reflected the adjusted penalties and went into effective November 5, 2019.

Medicare Secondary Payer Rules (MSP Rules)

The MSP Rules govern how group health plans (GHPs) pay claims of individuals covered under both the plan and Medicare, as well as prohibit certain actions of employers subject to the Rules:

  • Penalty for offering Medicare beneficiaries financial or other benefits as incentives not to enroll in, or terminate enrollment in, a GHP that is, or would be, primary to Medicare is $9,472 (increased from $9,239).
  • Penalty for repeated or willful failure to provide information regarding GHP coverage upon request is $1,542 (increased from $1,504).
  • Penalty for responsible reporting entities that fail to provide information that identifies the GHP as primary to Medicare is $1,211 (increased from $1,181).

Summary of Benefits and Coverage (SBC)

The Affordable Care Act (ACA) requires group health plans to provide the SBC, which describes the benefits and coverage under the employer’s plan, to plan participants and beneficiaries. Generally, it must be provided prior to enrollment, at each new plan year, and upon request. The penalty for each willful failure to provide an SBC is $1,156 (increased from $1,128).

For more information on how to comply with these requirements, check out ComplianceDashboard’s material on the MSP and SBC rules!

The information and content contained in this blog post are for general informational purposes only, and does not, and is not intended to, constitute legal advice.

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