With the adoption of the Consolidated Appropriations Act, 2021 (CAA), Congress has mandated that agent, broker and consultant compensation on all group health plans and individual health insurance policies be disclosed effective for arrangements entered into, renewed on extended on or after December 27, 2021. While many of us are generally opposed to mandates, this is the kind of positive action that strengthens the role of benefit specialists and empowers us to demand the same level of transparency of providers and carriers/networks for our clients.

How will this work?

This law requires agents, brokers and/or consultants (and their subcontractors) to disclose their compensation to plan fiduciaries. Specifically, any covered service provider that receives compensation in excess of $1,000 annually must provide this disclosure. The disclosure must include amounts paid directly and those received indirectly related to group health plans. This requirement applies to both fully insured and self-funded, which includes level-funded plans. The law requires notification prior to the beginning of a plan year and creates an obligation to update the group about changes in that compensation that occur during the year.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.