Compliance Recap | Apr. 2025
The DOL released an updated version of the CHIP Model Notice and covered employers under the San Francisco Health Care Security Ordinance (HCSO) need to submit the 2024 Employer Annual Reporting Form.
The U.S. Department of Labor (DOL) has released an updated version of the Children’s Health Insurance Program (CHIP) model notice.
Under the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA), employers that sponsor group health plans are required to provide an annual CHIP notice to employees who reside in states offering premium assistance under Medicaid or CHIP programs. This requirement is based on the location of eligible employees, not the employer’s physical address.
Employers are not required to use the DOL model notice. Many opt to tailor the content to their workforce by:
There is also no prescribed delivery method, as long as the notice reaches all employees who are, or may become, eligible for the group health plan and who live in states with available premium subsidies. Distribution often takes place during open enrollment or as part of a Wrap Summary Plan Description but must also occur upon hiring new employees.
Regardless of the method used, employers must distribute the CHIP notice annually to comply with federal law. Timely and accurate dissemination is key to ensuring employees are informed of their potential eligibility for premium assistance.
Employers subject to the San Francisco Health Care Security Ordinance (HCSO) must complete and file their 2024 Employer Annual Reporting Form no later than May 2, 2025. This form must be submitted online through the submission portal.
This annual filing also fulfills a reporting obligation under the San Francisco Fair Chance Ordinance (FCO), which shares the same deadline of May 2, 2025. The Fair Chance Ordinance (FCO) requires employers to follow strict rules regarding applicants’ and employees’ arrest and conviction records and related information. Employers with five or more employees (total worldwide) and San Francisco contractors, subcontractors, and leaseholders are covered by the FCO.
Under the HCSO, businesses that meet the coverage criteria must allocate a minimum amount toward health care expenses for every hour worked by qualifying employees in San Francisco. Each year, these employers are obligated to submit the Employer Annual Reporting Form, documenting their compliance with the ordinance.
While the form is generally due on April 30 of the subsequent year, the Office of Labor Standards Enforcement (OLSE) has granted an extension this year, moving the deadline to May 2, 2025. As clarified in a recent OLSE communication, no submissions will be accepted after that date. Failure to submit on time can result in penalties of $500 per quarter.
Employers who were not subject to either the HCSO or the FCO at any point in 2024 are exempt from submitting the form. To verify if filing is required, employers will begin the process by completing a brief eligibility questionnaire on the first page of the online form. Those who are obligated to report will proceed to the relevant sections of the form.
For employers interested in reviewing the form before filling it out online, the OLSE has provided a downloadable sample version of the 2024 form along with instructions.
Covered employers must ensure the 2025 HCSO Notice is visibly displayed at each job site or workplace where covered employees are based. For employees working remotely or offsite, the notice should be distributed by email or regular mail. The Notice is available in several languages.
Q: Do groups need to file and pay PCORI fees if they offer an FSA? Do groups have to file twice if group benefits run on calendar year, but the renewal and FSA run on different months? For example, a May 1 level-funded group with a medical plan that runs calendar year has an FSA that runs May 2025 through April 2026. Does the employer need to file two?
A: In short, an FSA is not subject to the PCORI fee if it is an excepted benefit. This means the employer cannot contribute more than $500 to the FSA (unless it is structured as a match) and employees eligible for the FSA must be eligible for the company’s group health plan. If the FSA meets these requirements, no PCORI fee is due.
In the second question, if the FSA is excepted, then no PCORI is needed, regardless of whether it operates on a different plan year. The level funded plan will need to pay the PCORI fee.
If the employer had an HRA and a level funded plan (i.e., two self-funded plans), or an FSA that is NOT excepted and a level-funded plan, two PCORI fees are due unless the two plans have the same employer-sponsor and operate on the same plan year.
The IRS has provided a helpful chart for applying the PCORI fee to various types of health coverage.
Resources
Overview of ACA affordability requirements for employer-sponsored health coverage, including annual percentage thresholds, IRS safe harbors (FPL, Rate of Pay, Form W-2), and key factors affecting employee contributions such as flex credits, opt-out incentives, and wellness programs.
The IRS released the 2027 health savings account (HSA) annual contribution limits and high deductible health plan (HDHP) requirements in IRS Rev. Proc. 2026-24.
Each year, employers may be responsible for reporting and paying the Patient-Centered Outcomes Research Institute (PCORI) fee. Here’s a high-level overview of what to expect for the 2026 filing cycle.
What "covered" should feel like.
What "covered" should feel like.
What "covered" should feel like.
What "covered" should feel like.
What "covered" should feel like.
