Simplifying Insurance Insurance | Employee Benefits | Risk Management | Financial Strategies...

Simplifying Insurance

Insurance | Employee Benefits | Risk Management | Financial Strategies

Surviving aDepartment of Labor (DOL) Audit

simplifying Insurance | Background

The Employee Retirement Income Security Act of 1974 (ERISA) establishes reporting provisions and participant requirements for all private employer health & welfare benefit plans.

Expanded several times to include other health laws. COBRA, HIPAA

DOL enforces ERISA

simplifying Insurance | General ERISA Requirements

Plan Document A Plan Document is the written document(s)

describing plan terms and conditions, including some general ERISA-required provisions Includes insurance contracts, policies, riders and

third party administrator (TPA) service agreements Must be distributed upon request (within 30

days after written request, to avoid penalties).


Summary Plan Description (SPD) A SPD is the written document(s)

summarizing the plan (WRAP is the common format as most benefit books do not contain all the required items)

Time frames for distribution: upon plan enrollment; and every 5 years (plan has been modified) or every 10 years (no plan modifications)

Must be distributed to participants and any beneficiaries entitled to benefits


Summary of Material Modifications (SMM) A SMM is the written document summarizing

the changes to the SPD Must be distributed within 210 days after the

end of the plan year If an updated SPD is distributed, no SMM is

required Must be distributed to participants and any

beneficiaries entitled to benefits


Summary of Material Reduction in Covered Services/ Benefits (SMR) A SMR is the written document summarizing

the reductions to the health (medical) plan Must be distributed within 60 days Must be distributed to participants and any



Annual Report An Annual report is the 5500 filed with the

DOL and Internal Revenue Service (IRS) disclosing financial aspects of the plan Exemption for small plans with less than 100

participants at the beginning of the plan year Must be filed annually within 7 months of the

end of the plan year; and Must be distributed to participants upon

request


Summary Annual Report (SAR) A SAR is the written document summarizing

the Annual Report (5500) Must be distributed within 60 days of the 5500

filing Must be distributed to participants and any



Internal and External Claims and Appeal Procedures These are the written document(s) describing

the procedures for claims and appeals Generally distributed by the insurer or TPA Recommendation: Include PPACA

amended language in all WRAP documents Must be distributed to participants and any



COBRA Requirements Initial COBRA notice COBRA election notice Notice of unavailability of COBRA Notice of COBRA early termination Exemption for Government & Church plans

and small plans (less than 20 employees) Specific timing and distribution

requirements for bullets 1-4


HIPAA Portability Requirements Certificate of Creditable Coverage

This is the document that certifies the time the participant was covered under another group health plan

Must be distributed upon loss of coverage (generally distributed by the insurer or TPA)

Must be distributed to participants and beneficiaries who lose coverage


HIPAA Portability Requirements cont. Notice of Preexisting Condition Exclusion

Must be distributed with enrollment materials Must be distributed to participants Individual notice must be distributed to participants

who present a certificate of creditable coverage Notice of Special Enrollment Rights

This is the document that describes all of the special enrollment rules (marriage, birth, etc.)

Must be distributed prior to or during enrollment to all covered employees


Misc. Notices Women’s Health and Cancer Rights Act

Must be distributed with initial enrollment materials (all covered employees) and annually (participants)

Newborns’ and Mothers’ Health Protection Act Must be distributed with initial enrollment materials

(all covered employees) and annually (participants)


Misc. Notices cont. CHIPRA

Must be distributed annually to all employees Michelle’s Law

Must be distributed at the time that a plan requires certification of student status to any applicable participants

HIPAA Wellness Program Must be distributed if there is a reward based on

outcome annually to all employees


Misc. Notices cont. Medical Child Support Order

Must be distributed upon receipt and qualification to the applicable participant

USERRA Needs to be posted in the workplace (no

distribution requirement if posted) FMLA Notice and Written Guidance

Needs to be posted in the workplace (no general distribution requirement if posted)

Must be distributed to any applicable participants


Misc. Notices cont. HIPAA Privacy and Security

Notice of Privacy Practices Notice of Breach of unsecured PHI Specific timing and distribution requirements

for the above items PPACA Grandfather Status

If any part of the plan is grandfathered, this must be distributed whenever plan information is provided

Must be distributed to all participants


Misc. Notices cont. GINA

Needs to be posted in the workplace (no general distribution requirement if posted)

W-2 Reporting of Health Insurance Aggregate cost of coverage must be disclosed Effective beginning January 2013 for 2012

coverage Summary of Benefits Coverage (SBC) and

Advance Notice of Mid-Year Changes Look for an update on this soon!

simplifying Insurance | Penalties

Generally $110/ day per participant who requests the document (SPD, SAR, all notices, etc.)

Penalties can be increased if the issue is brought before the court

Special Exceptions: 5500- Up to $1,100/ day per return HIPAA Breach- Specific (significant) penalties

simplifying Insurance | Conclusion

Questions?

Simplifying Insurance Insurance | Employee Benefits | Risk Management | Financial Strategies...

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