ERISA (Employee Retirement Income Security Act) is a set of federal laws and regulations that governs both qualified retirement plans (pension, profit sharing, and 401(k) plans) and welfare benefit plans (e.g., group life, health, dental, and disability insurance plans and other fringe benefit plans). ERISA is enforced primarily by the Department of Labor (DOL).

Almost every employer and employee benefit plan is subject to ERISA including benefits that are not provided through insurance, such as Health Care Flexible Spending Accounts and Severance Pay Plans. Even voluntary insurance programs may be considered ERISA plans, depending on the extent of an employer’s involvement in the plan. There are very few exceptions to ERISA.

For our consultative solutions, we have developed a highly efficient process to gather the information required to prepare documents that match the needs of each employer. Prior to engagement we develop a comprehensive proposal that takes into account the customers’ corporate structure, 5500 filing history, unique employer groups or classes and the employer’s approach to describing benefits to their employees.

We are proactive. We contact our clients every year to outline the legislative changes made by the DOL and to understand if the client has made changes to the offered benefits. During the year, we are available for client consultations and to answer questions about ERISAPros’s documents. We strive to anticipate and then exceed our clients’ expectations.

We have developed a world class, web-based solution that allows an employer or broker to input the information into the system and create documents for download in a matter of minutes. This solution, Wrap–Tight®, compliments our consultative solutions and is targeted toward smaller, less complex clients.

In addition, we use sophisticated tools to track customer opportunities, customer data and distribute documents in a format to comply with the DOL safe-harbor requirements.

Avoiding DOL Penalties

Being in compliance with ERISA can help you avoid costly government penalties. For example, failure to submit an annual Form 5500 on time can result in penalties of up to $2,586 per day. The fine for late delivery of a Summary Plan Description (SPD), Summary of Material Modification (SMM) or Summary Annual Report (SAR) can be as much as $184 per day.

These penalties apply to each plan, they are cumulative, and there is no statute of limitations for them. If an employer with four separate plans (group life, medical, dental, and disability insurance policies) files its Form 5500s just 30 days late, it can be fined $256,800!

Reducing Litigation, Jury Trials & Punitive Damages

Employee lawsuits over denied benefits are expensive and time consuming. They can be reduced if an employer is able to show that the claim was paid properly according to the terms of the SPD provided to the employee.

ERISA cases are tried in federal court rather than state court. This is a significant advantage for the employer/defendant. In federal court, there are no jury trials or punitive damages as there are in state courts.

Another advantage of having your case tried in federal court is that it is more difficult to overturn a plan administrator’s claim decision in federal court. Having a compliant SPD means your dispute will be tried in a federal court rather than a state court.

Reducing Costs

ERISAPros’ compliance and document solutions allows employers to save money by adopting a single wrap plan that covers all of their benefit plans. This means you only have to file one Form 5500 and distribute a single SPD and SAR. If amendments are required in response to legislative or regulatory changes, you’ll only need to make changes to one document, rather than once for each separate component benefit plan.

ERISAPros‘ plans are affordable, and, more importantly, they cost a fraction of what you might pay if your plans are found to be out of compliance.

At ERISAPros we are at the forefront of where compliance and technology meet.

An Important Part of Our Service

We help you stay in compliance by contacting you every year to check for changes that could affect your compliance.

The Law Could Change

ERISA’s reporting and disclosure rules for health and welfare plans are intended to establish that important balance between the interests of the employer and the employee: the employee’s right to know his or her benefits and the employer’s right to rely on a uniform body of federal law, with all its advantages. Yet, the constantly changing laws in this area can seem daunting for an employer trying to stay in compliance.

For example, Healthcare Reform has been requiring changes to SPDs and plan documents at least annually. Document updates may also be required due to new court cases, or legislation and regulations.

With an ERISAPros Wrap Plan, we keep track of these changes for you so you can focus on the things that are important to you.

Documents Need to Change as Situations Change

A company’s situation can change over time. You probably make some changes to your benefit plans every year as part of the renewal process, whether you change your deductible, copay, and/or waiting period, or you move to a new insurance carrier altogether. You might cross the 100-participant threshold that requires you to file a Form 5500. You may even buy another company or sell a subsidiary.

When you experience changes, your documents often need to change, too, in order to keep them in compliance with ERISA. Updating your Wrap–Tight® documents from ERISAPros is easy and affordable.