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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).
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
beneficiaries entitled to benefits
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
beneficiaries entitled to benefits
simplifying Insurance | General ERISA Requirements
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
beneficiaries entitled to benefits
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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)
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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
simplifying Insurance | General ERISA Requirements
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?