DOL fines of $10,000+ are common in health & welfare plan audits
Did you know that the DOL’s EBSA agency has 873 FTE’s and nearly 80% of their $183 million budget dedicated for enforcement? Over the years, we’ve spoken to numerous employers and group benefit plan professionals and, if you’re like them, you’re probably thinking 1 of 2 things: either (a) “Wow! That’s a lot of resources, I better be prepared for an audit!” or (b) “So what? They’ll never get around to auditing me”.
We’d encourage you to think more along the lines of “Wow! That’s a lot of resources, I better be prepared for an audit!” but if you’re not, consider the following: In the first year of true audits; FY 2012, the EBSA achieved over $1.2 billion in total monetary results. That’s a 555% ROI. How well did your business do last year?
The DOL is not slowing down, protect yourself and your business now…..
Call us now and get compliant.
Fyi:
REPORTING AND DISCLOSURE REQUIREMENTS TO KNOW
- Plan document: ERISA requires that every benefit plan be established and maintained according to a written document that must be readily
available upon request. A plan document describes the participants’ rights, eligibility, benefits and responsibilities under the plan, as well as the
terms and conditions for administering the plan. It is a common misconception that a certificate of insurance will meet ERISA’s plan document
requirement. A plan document is significantly more detailed and the plan sponsor, not the insurance carrier or benefits broker, is solely
responsible for the document.
▪ Summary Plan Description: A summary plan description (SPD) is a summary of the participants rights, benefits, and obligations under the plan.
The SPD should be written in a manner easily understood by the average plan participant and should include pertinent plan information, The
.SPD must include the name and address of the plan administrator, define the plan year, and include information regarding the funding and
eligibility requirements under the plan. The SPD must be provided within 90 days of coverage or 120 days of the plan’s effective date.
- Form 5500: The primary information reporting obligation imposed by ERISA on health and welfare benefit plans is an annual report through a
Form 5500. Unless an exemption applies, ERISA requires the plan sponsor of each separate ERISA plan to file an annual Form 5500. Many small
plans with less than 100 participants will be exempt if they comply with certain requirements but most plans with over 100 participants must file.
