Wrap Plan Documents – The New Fundamental ACA Compliance Tool

Reasons for an Employer to create a Wrap Plan Document and Distribute an SPD

Required by ERISA Combines several benefit offerings into one plan for 5500

filing or other purposes Allows employer to define elements that are often

inconsistent or missing in certificates issued by insurance carriers

Allows employer to create plan features that the carrier will not document in insurance certificate

ACA has made them more important than ever!!

Required by ERISA Required by ERISA for ALL plans

Regardless of size or funding But not plans that are exempt from ERISA – church and

governmental plans Informs participants and beneficiaries about their benefits,

rights, and obligations under the Plan ERISA requires that the plan documents include specific

information Statement of Rights Plan Sponsor Name Plan funding information

Required by ERISA Distribution Requirements for SPD

Within 120 days of implementing new group health plan Within 90 days of enrollment in plan Within 210 days following the last day of the 5th plan year if SMM Within 210 days following the last day of the 10th year if no SMMPlan document must be provided within 30 days of a request

Penalties Up to $110 per day for failure to provide Failure to have one does not invalidate the plan Bigger concern is when documents issued do not accurately

reflect the plan’s intent

Combine Several Benefit Options into One Plan

If subject to 5500 filing requirements, will allow employer to file only one 5500 (and will reduce penalties if filing is late or missed)

HRA/Medical Plan or Wellness/Medical Plan – Employer will want to have these plans combined so that you can limit COBRA on the HRA or wellness to those who elect COBRA on medical. If the plans are separate, then participants have to be

given a separate COBRA election

Create Consistent Plan Features and Add missing ones

Eligibility Medical carriers often will not customize ACA waiting period and eligibility details

Leave provisions – each insurer or administrator will define based on their own templates and preferences

Effective date and termination of employee and dependent coverage Usually not consistent from carrier to carrier

Plan year Not included in most carrier certificates Needed to determine compliance date for most ACA requirements

Design Plan Features Expand eligibility (with permission of carrier when

insured or stop loss carrier if self-funded) Limit eligibility

Spousal exclusion (and/or dependent) Change wording to exclude those that do not comply

with eligibility audit Include wellness plan requirements Add benefits or exclusions (with permission of

carrier)

ACA Increase in DOL Audits Increase in provider initiated claims appeals More items that need to be documented

Waiting periods Eligibility Notices

Polestar Benefits, Inc.412 Jefferson Parkway, Suite 202Lake Oswego, OR 97035(855) 222-3358www.pole

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