Are Your Benefit Plans Compliant?


NEW YORK—This question is often answered, “Of course they can,” but will they ever? Possibly not. All employers can try to be compliant so they can stand the rigors of a Department of Labor audit or a disgruntled employee’s lawsuit.

The “things to do” list to achieve compliance is seemingly endless. An employer might say, “We offer group life insurance along with an insured HMO, PPO, Dental and Vision policy, so why do we need to worry about compliance when we have contracts with each of the carriers/providers?

The reason for seeking complete compliance is found in the Employee Retirement Income Security Act of 1974. ERISA, as it is also referred to, applies the same compliance requirements and standards to an employer with two employees as it does to larger companies such as Google, Essilor, VSP or Walmart. Just because an employer offers insured plans (versus self-funded plans) does not address plan documents, summary plan descriptions, regulatory notices, or the current Affordable Care Act (ACA) requirements.

Having fewer employees often allows employers some relief from the more stringent requirements found for companies with 50 employees or more. While most all federal regulations apply, some states have additional requirements for companies with 100+ employees. Your broker-consultant should be conversant with the regulations and provide you guidance.

Should you receive a notice from the Department of Labor, informing you they will conduct an audit of your employee benefit plan compliance, we offer the following suggestions so you can always be prepared for such an investigation by having these documents current and complete:

Typically, a DOL audit gives you 30-days to provide copies of:
1. Plan Documents, Trust Agreements, and Amendments.
2. summary plan documents, summary material modifications, summary of benefits and coverage, booklets, certificates and any documentation provided to employees.
3. Form 5500 reports for the latest plan year.
4. Documents identifying plan sponsors’ board members and owners.
5. Fidelity bonds and/or stop-loss policies.
6. Invoices, proposals, letters of agreement and contracts with any service providers.
7. Invoices for all other expenses including legal advice.
8. All correspondence regarding relating to the health benefits and/or correspondence about any complaints.
9. Board or Committee minutes relating to the plan benefits.
10. Participant health plan enrollment package.
11. All participant records.
12. Record of any employee contribution requirements.
13. Data supporting contributions such a payroll records.
14. Documents identifying billing statements.

In addition, other documents will likely be required and those related to:
1. HIPAA Privacy and Security
2. Women’s Health
3. Mental Health Parity
4. Credible Coverage
5. Special Enrollment Rights
7. Wellness and Disease Management programs
8. ACA Market Place Exchanges

It is recommended that all employers, large and small, always retain current documentation as noted above to be as compliant as possible with federal and state benefits regulations. Employers should also visit various public websites where employers can, in conjunction with their broker consultant, find further guidance and assistance. One such site can be found here.

Victor A. Deksnys, Contributing Writer
Alliance Partner
Aligned Growth Partners, LLC
(415) 806-0554