Employee Retirement Income Security Act or ERISA…You have it? You better!

Federal Compliance Warning

ERISA (the federal Employee Retirement Income Security Act) requires employers who are plan administrators of their group health plans to comply with two important requirements or risk potential penalties and possible audits:

1. Maintain and distribute Summary Plan Description (SPDs) to plan participants which accurately reflect the contents of the plan and which includes specific information as required by federal law.
2. Group health plans must be administered and in agreement with a written Plan Document, which must be made available to plan participants and beneficiaries upon request.

Many companies mistakenly assume that insurance contracts, certificates of insurance and benefits summaries fulfill the ERISA requirements for an SPD and Plan Document – But they don’t include the required provisions that protect the plan and the employer.

Penalties for Non-Compliance

Employer or plan administrators may be liable for serious penalties if they don’t provide an SPD or have a current Plan Document:

• Failure to provide an SPD or Plan Document within 30 days of receiving a request from a plan participant or beneficiary can result in a penalty of up to $110 per day per participant or beneficiary for each violation.

• Lack of an ERISA Document could trigger a plan audit by the US Department of Labor (DOL). The DOL would audit ALL compliance related documents, which includes the following:
  • Medicare Part D Notice (Certificate of Creditable (or Non-Creditable)) Drug Coverage
  • CHIP or premium assistance
  • Wellness Program Disclosure (if providing wellness plan that is subject to HIPAA)
  • Women’s Health & Cancer Rights –Hospital Stay Rights for Childbirth
  • Newborns’ and Mothers’ Health Protection Act (All who offers maternity benefits)
  • Notice of Non-Federal Governmental Plan Opt-Out (if applicable)
  • Mental Health & Parity Act Notice of Availability of HIPAA Privacy Notice
  • Grandfathered status notice (grandfathered plans only)
  • Section 125 Plan Document
  • Notice of HIPPA Special Enrollment Rights
  • HIPPA/PHI Privacy Policies and Practices
  • General Notice of Preexisting Condition Exclusion (if applicable)
  • COBRA general notice/initial notice if over 20 employees
  • Health Care Reform – Employee Notice of Exchange

• The DOL has increased its audit staff and national enforcement initiatives to investigate employers’ compliance with Health Care Reform, resulting in companies of all sizes of a risk of an audit and being required to provide an SPD and Plan Document.

The solution

TREK Insurance Group, LLC has partnered with a legal firm to provide all required documents and draft the SPD and ERISA Wrap Document for free in many cases or at a small one-year fee based on your size of the group.  All documents that the DOL requires will be supplied and custom to your groups plans, regulations, and mandates for each of my clients.  This service would save you as employer thousands of dollars per year in fees, all while protecting your company’s liability and penalties of an audit by The Department of Labor or Employee Litigation.  Contact me!  It may be worth your time or saving your business.  An HR person can destroy a company if the wrong broker is hired and have given false information because they aren’t up to speed on the continuous changes of the rapid health Insurance industry.  Don’t be that company! I can clean that rubbish up and have you back on course in no time!