noncompliance period

(3) Enforcement authority relating to genetic discrimination (A) General rule In the cases described in paragraph (1), notwithstanding the provisions of paragraph (2)(C), the succeeding subparagraphs of this paragraph shall apply with respect to an action under this subsection by the Secretary with respect to any failure of a health insurance issuer in connection with a group health plan, to meet the requirements of subsection (a)(1)(F), (b)(3), (c), or (d) of section 2702 1 or section 2701 1 or 2702(b)(1) 1 with respect to genetic information in connection with the plan. (B) Amount (i) In general The amount of the penalty imposed under this paragraph shall be $100 for each day in the noncompliance period with respect to each participant or beneficiary to whom such failure relates. (ii) Noncompliance period For purposes of this paragraph, the term “noncompliance period” means, with respect to any failure, the period— (I) beginning on the date such failure first occurs; and (II) ending on the date the failure is corrected. (C) Minimum penalties where failure discovered Notwithstanding clauses (i) and (ii) of subparagraph (D): (i) In general In the case of 1 or more failures with respect to an individual— (I) which are not corrected before the date on which the plan receives a notice from the Secretary of such violation; and (II) which occurred or continued during the period involved; the amount of penalty imposed by subparagraph (A) by reason of such failures with respect to such individual shall not be less than $2,500. (ii) Higher minimum penalty where violations are more than de minimis To the extent violations for which any person is liable under this paragraph for any year are more than de minimis, clause (i) shall be applied by substituting “$15,000” for “$2,500” with respect to such person. (D) Limitations (i) Penalty not to apply where failure not discovered exercising reasonable diligence No penalty shall be imposed by subparagraph (A) on any failure during any period for which it is established to the satisfaction of the Secretary that the person otherwise liable for such penalty did not know, and exercising reasonable diligence would not have known, that such failure existed. (ii) Penalty not to apply to failures corrected within certain periods No penalty shall be imposed by subparagraph (A) on any failure if— (I) such failure was due to reasonable cause and not to willful neglect; and (II) such failure is corrected during the 30-day period beginning on the first date the person otherwise liable for such penalty knew, or exercising reasonable diligence would have known, that such failure existed. (iii) Overall limitation for unintentional failures In the case of failures which are due to reasonable cause and not to willful neglect, the penalty imposed by subparagraph (A) for failures shall not exceed the amount equal to the lesser of— (I) 10 percent of the aggregate amount paid or incurred by the employer (or predecessor employer) during the preceding taxable year for group health plans; or (II) $500,000. (E) Waiver by Secretary In the case of a failure which is due to reasonable cause and not to willful neglect, the Secretary may waive part or all of the penalty imposed by subparagraph (A) to the extent that the payment of such penalty would be excessive relative to the failure involved.

Source

42 USC § 300gg-22(b)(3)


Scoping language

For purposes of this paragraph
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