2027 Open Enrollment Compliance Checklist: What Employers Need to Know

Preparing for open enrollment requires balancing employee communication with strict regulatory compliance. For plan years beginning on or after January 1, 2027, employers sponsoring health plans must account for updated cost-sharing limits, evolving ACA requirements, and key annual participant notices.

To help you streamline administration and minimize costs, here is your breakdown of the major plan design updates and required disclosures for the 2027 plan year.

Part 1: Key Plan Design Updates for 2027

1. ACA Affordability Standard

Applicable Large Employers (ALEs)—those with 50 or more full-time equivalent employees—must offer affordable, minimum-value health coverage to avoid IRS “pay-or-play” penalties.

• The 2027 Threshold: The affordability percentage increases to 10.22% for plan years beginning on or after Jan. 1, 2027 (up from 9.96% in 2026).
• Action Steps: Review the IRS’s optional safe harbors (Form W-2, rate-of-pay, or federal poverty line) to ensure at least one plan option meets this threshold for full-time staff.

2. Out-of-Pocket Maximums (OOPMs)

Non-grandfathered health plans must comply with annual limits on total cost-sharing for essential health benefits:

• General ACA Limits: Increased to $12,000 for self-only and $24,000 for family coverage.
• Embedded Individual OOPM: Health plans must embed an individual OOPM in family coverage if the family maximum exceeds $12,000.
• HDHP Limits: Plans paired with Health Savings Accounts (HSAs) have lower statutory OOPM limits. For 2027, these are $8,700 for self-only and $17,400 for family coverage.

3. 2027 HDHP and HSA Limits

The IRS released the updated inflation-adjusted limits for High Deductible Health Plans and HSAs:

Coverage Type / Limit	2026 Limit	2027 Limit	Change
HSA Contribution Limit (Self-Only)	$4,400	$4,500	Up $100
HSA Contribution Limit (Family)	$8,750	$9,000	Up $250
HSA Catch-Up (Age 55+)	$1,000	$1,000	No change
HDHP Minimum Deductible (Self-Only)	$1,700	$1,750	Up $50
HDHP Minimum Deductible (Family)	$3,400	$3,500	Up $100
HDHP Max OOPM (Self-Only)	$8,500	$8,700	Up $200
HDHP Max OOPM (Family)	$17,000	$17,400	Up $400

4. Other Account Limits & Offerings

• Health FSAs: The 2026 contribution limit was $3,400. Employers should monitor upcoming IRS announcements for the official 2027 cap.
• Excepted Benefit HRAs (EBHRAs): The annual maximum contribution limit increases to $2,250 for 2027.
• Expanded Fertility Benefits: Federal guidance allows employers to explore pathways for standalone fertility benefits—such as EBHRAs, EAPs, or proposed excepted benefit rules capped up to a $120,000 lifetime maximum. Check with your carrier or TPA regarding available coverage options.

5. Preventive Care & Mental Health Parity

• Preventive Care Updates: Confirm that in-network coverage includes the latest preventive care recommendations without cost-sharing (e.g., updated HRSA cervical cancer screening guidelines taking effect in 2027).
• Mental Health Parity (MHPAEA): Statutory requirements to conduct and maintain comparative analyses for Nonquantitative Treatment Limitations (NQTLs)—such as prior authorization or step therapy—remain active. Ensure your TPA or issuer has updated these analyses for 2027.

Part 2: Required Open Enrollment Participant Notices

Including mandatory annual disclosures within your open enrollment package streamlines administration and ensures compliance.

1. Summary of Benefits and Coverage (SBC): Must be provided annually to applicants and enrollees.
2. Medicare Part D Notice: Must be distributed annually prior to October 15. Note: The simplified determination method no longer applies for 2027; plans must ensure coverage pays on average at least 73% of participant drug expenses to be creditable.
3. Summary Plan Description (SPD) / SMM: Any major 2027 plan changes must be communicated via an updated SPD or a Summary of Material Modifications (SMM).
4. CHIP Notice: Mandatory for employers with health plans in states that offer premium assistance subsidies.
5. Initial COBRA Notice: Must be provided to new participants and covered dependents within 90 days of coverage.
6. Notice of Patient Protections: Required if the plan obligates participants to designate a primary care physician (PCP).
7. HIPAA Notices:
   • Special Enrollment Rights Notice: Must be distributed at or before enrollment.
   • Privacy Notice: Required every three years (or a notice explaining how to access a copy).
8. WHCRA Notice: Mandatory disclosure regarding mastectomy-related rights provided at enrollment and annually thereafter.
9. Wellness Program Notices: Required if your plan offers health-contingent wellness rewards/surcharges (HIPAA) or involves health exams/disclosures (ADA).
10. ICHRA Notice: For employers offering Individual Coverage HRAs, this notice generally must be provided at least 90 days prior to the start of the plan year.

Action Summary for Employers

Before launching your 2027 open enrollment period:

• [ ] Verify that health plan designs comply with new affordability, OOPM, and HDHP/HSA limits.
• [ ] Update enrollment materials, SPDs, and SMMs to reflect plan changes.
• [ ] Audit your open enrollment packet to ensure all annual participant notices are included.
• [ ] Coordinate with your legal counsel, broker, or TPA to verify compliance across all offerings.

Disclaimer: This article provides a general overview of benefit plan compliance and should not be construed as legal or tax advice. Consult with legal counsel for specific guidance on your organization’s health benefit plans.