Sec. 108. Limitations on State restrictions on employer auto-enrollment

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No State shall establish a law that prevents an employer that is allowed an exclusion from gross income, a deduction, or a credit for Federal income tax purposes for health benefits furnished to a participant or beneficiary from instituting auto-enrollment which meets the requirements of subsection

(b)for coverage of a participant or beneficiary under a group health plan, or health insurance coverage offered in connection with such a plan, so long as the participant or beneficiary has the option of declining such coverage. The requirement of this subsection with respect to an employer and an employee is that the employer automatically enroll such employee into the employment-based health benefits plan for individual coverage under the plan option with the lowest applicable employee premium. In no case may an employer automatically enroll an employee in a plan under paragraph

(1)if such employee makes an affirmative election to opt-out of such plan or to elect coverage under an employment-based health benefits plan offered by such employer. An employer shall provide an employee with a 30-day period to make such an affirmative election before the employer may automatically enroll the employee in such a plan. Each employer described in paragraph

(1)who automatically enrolls an employee into a plan as described in such paragraph shall provide the employees, within a reasonable period before the beginning of each plan year (or, in the case of new employees, within a reasonable period before the end of the enrollment period for such a new employee), written notice of the employees’ rights and obligations relating to the automatic enrollment requirement under such paragraph. Such notice must be comprehensive and understood by the average employee to whom the automatic enrollment requirement applies. The written notice under subparagraph

(A)must explain an employee’s right to opt out of being automatically enrolled in a plan and in the case that more than one level of benefits or employee premium level is offered by the employer involved, the notice must explain which level of benefits and employee premium level the employee will be automatically enrolled in the absence of an affirmative election by the employee. Nothing in this section shall be construed to supersede State law which establishes, implements, or continues in effect any standard or requirement relating to employers in connection with payroll or the sponsoring of employer-sponsored health insurance coverage except to the extent that such standard or requirement prevents an employer from instituting the auto-enrollment described in subsection (a). For purposes of this section, the term group health plan does not include excepted benefits (as defined in section 2781(c) of the Public Health Service Act ( 42 U.S.C. 300gg–91(c) )).

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42 USC 300gg–91(c)

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Sec. 108

Limitations on State restrictions on employer auto-enrollment

Cite42 USC 300gg–91(c)

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