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DOL Increases Civil Monetary Penalties for Certain ERISA Violations

The DOL recently issued a final rule that adjusts for inflation the amounts of civil monetary penalties assessed or enforced in its regulations, including for certain ERISA violations. The adjusted penalty amounts apply to penalties assessed after January 15, 2021 and for which the associated violations occurred after November 2, 2015. Some of the penalties that were increased include the following: The maximum penalty for failing to properly file a pension or welfare benefit plan?ÇÖs annual Form 5500 increased from $2,233 per day to $2,259 per day. The maximum penalty for failing to provide notices of blackout periods or of the right to divest employer securities increased from $141 per day to $143 per day (each statutory recipient is a separate violation). The maximum penalty for failing to provide employees the required Children?ÇÖs Health Insurance Program (CHIP) coverage notices increased from $119 per day to $120 per day (each employee… Continue Reading

Before Cleaning Out Files, Brush Up on Record Retention Requirements

Our world is filled with paper and electronic records, and the HR departments at most companies are no exception. Enrollment forms, notices, plan documents, summary plan descriptions, benefit statements, and service records are just a few of the records that fill the HR department?ÇÖs file cabinets and computer storage. While it might be tempting to clean out files, plan sponsors should exercise care before disposing of any files relating to benefits under a plan. A clean desk today could create headaches tomorrow. Generally, ERISA requires an employer to retain plan records to support plan filings, including the annual Form 5500, for at least six years from the filing date (ERISA ?º107) and to maintain records for each employee sufficient to determine the benefits due or that may become due to such employee (ERISA ?º209), with no time limit on such requirement. In addition, HIPAA requires retention of the policies and… Continue Reading

Additional Federal Guidance Regarding COVID-19 and Telehealth Coverage: Some Employer Take-Aways

The U.S. Departments of Labor, Treasury, and Health and Human Services (the ?Ç£Departments?Ç¥) recently issued FAQs regarding the Families First Coronavirus Response Act, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), and COVID-19. A number of these FAQs address a group health plan?ÇÖs required coverage of COVID-19 tests, including which tests must be covered, related facility fees, reimbursement rates, and balance billing to patients. Employers should ensure that the third party administrators of their group health plans have incorporated this guidance for plan administration purposes. In addition, some of the other FAQs may be of interest to employers. For example, the FAQs provide that, if a group health plan reverses the increased coverage of COVID-19 or telehealth after the COVID-19 public health emergency period is over, the Departments will consider the plan to have satisfied the requirement to provide advance notice of changes to the Summary of Benefits… Continue Reading

SBC Relief for COVID-19 Coverage or Telehealth Changes to Group Health Plans

Generally, if an employer-sponsored group health plan makes a material modification to coverage midyear that would affect the content of the plan?ÇÖs Summary of Benefits and Coverage (?Ç£SBC?Ç¥), the plan administrator must provide participants with 60 days?ÇÖ prior notice of the modification. The U.S. Departments of Labor, Treasury, and Health and Human Services have issued a FAQ stating that they will not take any enforcement action against any plan for not providing such notice when the modification is to provide greater coverage related to the diagnosis and/or treatment of COVID-19 or to add benefits or reduce or eliminate cost sharing for telehealth and other remote care services. However, the plan administrator must still provide notice of the changes to participants as soon as reasonably practicable. This non-enforcement policy only applies while there is a public health emergency declaration or national emergency declaration related to COVID-19 in effect. The FAQs are… Continue Reading

Agencies Update Group Health Plan Required Disclosure Documents

Federal agencies recently issued updated versions of certain documents that are required to be disclosed to individuals under applicable employer-sponsored group health plans. A set of FAQs regarding the Affordable Care Act (?Ç£ACA?Ç¥) was issued by the federal Departments of Labor (?Ç£DOL?Ç¥), Health and Human Services (?Ç£HHS?Ç¥), and Treasury (collectively, the ?Ç£Departments?Ç¥), which describe recent changes made by the Departments to the ?Ç£summary of benefits and coverage?Ç¥ template under the ACA (?Ç£SBC?Ç¥). Among other minor changes to the SBC, certain verbiage on the SBC and the associated uniform glossary were revised to reflect the prior elimination, as of January 1, 2019, of the tax penalty related to an individual?ÇÖs failure to comply with the so-called ?Ç£individual mandate?Ç¥ under the ACA. The FAQs also provide additional guidance regarding the updated SBC coverage examples calculator that was released by HHS late last year. The revised SBC and SBC coverage examples calculator each… Continue Reading

Stop-Lost: Common Issues That May Cause Gaps in Your Stop-Loss Coverage

Once an employer is comfortable it can handle some exposure to fluctuating claims costs, it may opt to self-insure its group health plan in order to save money in the long run by avoiding paying the profit margin insurance carriers build into the premiums of fully-insured coverage. Some employers will forego some of the expected savings and purchase stop-loss coverage from an insurance carrier to help limit claims cost volatility. Under a stop-loss insurance policy, the insurance carrier will reimburse claims costs that exceed an agreed-upon dollar threshold. The employer is usually the insured on the stop-loss policy, although sometimes the group health plan itself is the insured under the policy instead. There are two primary types of stop-loss coverage: (i) individual; and (ii) aggregate. Stop-loss coverage will always include individual stop-loss and frequently includes aggregate coverage. (i) Individual stop-loss ?Çô Also referred to as specific stop-loss, individual stop-loss coverage… Continue Reading

Implementation Date for New SBC Template Announced

The DOL recently announced in a new Frequently Asked Questions (?Ç£FAQ?Ç¥) that health plans and insurers will be required to use a new Summary of Benefits and Coverage (?Ç£SBC?Ç¥) template for plan years beginning on or after April 1, 2017. The DOL, along with the U.S. Departments of Health and Human Services and the Treasury, intend to ?Ç£expeditiously?Ç¥ revise the new SBC template based on comments they receive concerning the proposed template that was published last month. Interested parties may submit comments regarding the proposed SBC template until March 28, 2016. The FAQ is available?áhere.

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