- Providing world class service and value for employee benefit group plans since 1987
Compliance has always been a critical part of employer-sponsored group health plans, but in 2026, the landscape is more complex than ever. Between federal transparency rules, new reporting obligations, updated Affordable Care Act (ACA) requirements, and expanded state-level mandates, employers must navigate an increasingly detailed set of responsibilities, each one tied to strict penalties if missed.
For HR leaders, benefits managers, and business owners, the challenge isn’t just understanding what must be reported or disclosed, it’s knowing when, how, and to whom those obligations apply.
At Taylor Benefits Insurance Agency, we understand that compliance is more than paperwork. It protects your organization from fines, builds employee trust, ensures plan transparency, and keeps your benefits strategy aligned with federal law.
This comprehensive guide breaks down every major reporting and disclosure requirement employers must meet in 2026, explains why each obligation matters, and clarifies how organizations can stay compliant without overwhelming their teams.
Three major trends explain why 2026 is a critical year for compliance:
Agencies such as the Department of Labor (DOL), IRS, and CMS have stepped up auditing, especially around mental health parity, transparency rules, and the No Surprises Act.
The push for healthcare cost visibility has given rise to rules requiring employers and insurers to publicly share plan pricing data and detailed claims information.
Today’s employees want clear information about coverage, rights, costs, restrictions, and appeals processes. Missing disclosures can damage trust and morale.
These factors mean employers cannot afford to be reactive — compliance must be planned, audited, and maintained year-round.
Below are the major obligations employers must meet. This is the clearest, most complete overview relevant to HR and benefits leadership.
Who must file?
Applicable Large Employers (ALEs) — organizations with 50 or more full-time employees or equivalents.
What must be filed?
Form 1095-C: Sent to employees describing their offered coverage.
Form 1094-C: Filed with the IRS summarizing annual compliance.
Deadline
Employee copies: March 1, 2026
IRS electronic filing: April 1, 2026
Penalties in 2026
Over $630 per return for late or incorrect filings.
Why it matters
The IRS uses these forms to determine whether employers owe employer-shared responsibility penalties under the ACA.
Taylor Benefits helps employers track full-time status, avoid affordability mistakes, and reduce the risk of IRS penalty letters.
Every participant in a group health plan must receive an up-to-date, compliant Summary Plan Description, outlining:
Plan eligibility
Covered services
Exclusions
Contributions and cost-sharing
Claims and appeals procedures
ERISA rights
COBRA rights
Plan administrator information
New participants: within 90 days of coverage
Upon request: within 30 days
An outdated or missing SPD is one of the most common triggers for DOL audits — and penalties can reach thousands per day.
The SBC is a standardized, consumer-friendly overview of benefits.
Open enrollment
New hires
Special enrollments
Upon employee request
Up to $1,406 per failure in 2026.
The SBC ensures employees understand coverage before making choices, helping employers avoid disputes and complaints.
Most employers must file Form 5500 for their health plan unless eligible for exemptions (very small plans on insured platforms may be exempt).
Employers with 100+ participants in their health plan.
Any employer with a funded plan or trust structure.
Last day of the 7th month after plan year end
(extensions available via Form 5558)
Failure to file can result in penalties of up to $2,670 per day.
One of the most aggressively enforced rules in 2026 is MHPAEA compliance.
Employers must maintain a written comparative analysis proving that non-quantitative treatment limits (NQTLs) — prior authorization, network admission, medical management — are comparable between mental health and medical/surgical benefits.
Upon DOL or CMS request: within 10 business days
Upon request from a state regulator
Upon participant request
Plans failing MHPAEA compliance face corrective action, penalties, and reimbursement obligations.
Taylor Benefits partners with carriers and administrators to ensure clients are fully prepared with required documentation.
These sweeping rules require posting or providing:
Plans must publicly post:
In-network negotiated rates
Out-of-network allowed amounts
Prescription drug prices (pending litigation)
These must be updated monthly.
In 2026, online cost-comparison tools must cover all services, allowing employees to see cost estimates for providers before seeking care.
This is one of the biggest compliance burdens for employers — especially self-funded groups. Employers are liable for accuracy even if a vendor posts MRFs on their behalf.
The No Surprises Act requires employers to provide:
Notice of Protections Against Surprise Billing
Transparency about balance billing
Continuity of care notices
Accurate provider directories
Good Faith Estimates (GFE) for certain services
Advanced Explanation of Benefits (AEOBs) (phased rollout)
Regulators heavily enforce NSA compliance; penalties apply if employers do not maintain accurate provider information or fail to issue required notices.
Employers offering prescription coverage must disclose whether their plan is creditable or non-creditable.
Notice to employees: Before October 15 every year
Annual filing with CMS: by October 15
Failing to disclose can cause employees to incur lifelong Medicare penalties — a serious HR liability.
Employers must issue accurate COBRA notices for:
Initial Rights
Qualifying Events
Election Notice
Conversion Rights
Termination of COBRA Coverage
Lawsuits often result from unclear or outdated COBRA notices. Fines can reach $110 per day per participant.
Taylor Benefits ensures clients use updated, compliant templates.
Employers must maintain and distribute:
Notice of Privacy Practices
Health Information Protection policies
Breach notifications within 60 days of discovery
Penalties range from $137 to $68,928 per violation, depending on severity.
Several states now require employers to submit:
Cost transparency data
Prescription utilization data
Coverage minimums
Mental health parity attestations
Paid leave coverage information
Key states include:
California
Oregon
Colorado
New York
New Jersey
Massachusetts
Washington
Employers with remote or hybrid teams may need multi-state compliance — a major 2026 challenge.
Future-ready compliance depends on proactive planning. Employers should:
Review all required notices, filings, and disclosures.
Carriers and TPAs can assist — but employers retain liability.
Update SPDs, SBCs, COBRA notices, NSA disclosures, and privacy statements.
Include all federal and state deadlines.
Ensure consistent communication and accurate employee guidance.
If regulators request proof, documentation is your strongest defense.
Compliance doesn’t need to overwhelm your internal team.
At Taylor Benefits, we support employers by:
Auditing current disclosures and documentation
Creating or updating SPDs, SBCs, and required notices
Managing ACA reporting and avoiding IRS penalties
Guiding MHPAEA comparative analysis preparation
Assisting with CMS, COBRA, HIPAA, and NSA requirements
Coordinating with carriers to ensure transparency compliance
Providing multi-state regulatory guidance for hybrid workforces
Our goal is simple:
To give employers peace of mind — knowing every reporting and disclosure requirement is handled correctly, completely, and on time.
Reporting and disclosure obligations will only continue to grow as health plan transparency and consumer protections expand. Employers who invest in compliance today avoid costly penalties tomorrow, and create a benefits environment built on trust and clarity.
For businesses of all sizes, 2026 is the year to get organized, simplify processes, and build a compliance infrastructure that evolves with the law.
Taylor Benefits Insurance Agency is here to guide you through every requirement, making compliance not just manageable, but strategic.
Group health plans must submit annual reports to federal agencies, including Form 5500 for larger employers, and provide required notices to employees. Reporting covers plan finances, participant counts, and compliance with federal health regulations. Accurate reporting ensures the plan meets legal obligations and avoids penalties.
Employers must provide a Summary of Benefits and Coverage during open enrollment at new hire enrollment upon request and when coverage changes significantly. The document ensures employees can compare plan options and understand costs and benefits before selecting or continuing coverage under the group health plan.
Todd Taylor oversees most of the marketing and client administration for the agency with help of an incredible team. Todd is a seasoned benefits insurance broker with over 35 years of industry experience. As the Founder and CEO of Taylor Benefits Insurance Agency, Inc., he provides strategic consultations and high-quality support to ensure his clients’ competitive position in the market.
We just started working with Taylor Benefits and could not be happier. Todd gave us quite the education as well as some time saving tools to help us manage our HR and save money too. We are looking forward to a long relationship!”
-Carol, Accounting Manager, recruitment marketing company, Campbell, CA
We’re ready to help! Call today: 800-903-6066