Health & Welfare | Documents & Policies
Under ERISA, every employee welfare benefit plan should be embodied in a written plan document. The plan document should be sufficient to enable the plan administrator (the person operating the plan) to determine who is eligible to be in the plan, when eligible employees enter the plan, what benefits are available, how the plan is financed (i.e., employer contributions, employee contributions, or both), how and when the benefits are paid, and how claim disputes are resolved. The plan document should be kept with the sponsoring employer's important papers and it should be kept up to date as the employer makes changes in the plan. The plan document does need not to be filed with any governmental agency.
Summary Plan Description (SPD)
ERISA requires that every plan be summarized in lay terms in a summary plan description (SPD). The specific requirements for the contents of an SPD are contained in regulations published by the United States Department of Labor (DOL). The SPD must be provided to each participant in the plan within 90 days after he or she becomes a participant. A copy of the SPD need not be sent to the DOL unless the DOL requests a copy. If a subsequent amendment to the plan results in a change in any of the information required to be in the SPD, a supplement to the SPD must be distributed to all participants within 210 days after the end of the plan year in which the change was adopted. In addition, if there is a material reduction in covered services or benefits provided under a group health plan, a summary of the change must be given to participants within 60 days after the adoption of the change (unless the employer provides such a description at regular intervals of not more than 90 days). If the plan has been amended, an SPD incorporating all amendments to the plan must be provided to the participants every 5 years. If the plan has not been amended, another copy of the SPD must be provided to the participants every 10 years.
COBRA
The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) amended ERISA, the Code and the Public Health Service Act (applicable to governmental plans) to require that group health plans that are subject to COBRA must offer the continuation of health coverage for a limited period of time to a participant and the participant's beneficiaries when a "qualifying event" occurs that would otherwise cause the person to lose such coverage. If a group health plan is subject to COBRA, the plan should have procedures in place for complying with COBRA's notice and election requirements. See also, COBRA! and The Return Of COBRA.
QMCSO
ERISA requires that group health plans comply with the terms of a qualified medical child support order (QMCSO). A QMCSO is an order issued by a domestic relations court (or certain administrative agencies) that orders a plan to provide health coverage to a child of a participant in the plan in connection with a divorce or family support proceeding. The plan must adopt procedures for reviewing medical child support orders in order to determine if they are QMCSOs.
Claims Procedure
ERISA requires that employee benefit plans provide claims procedures. These procedures must allow a claimant to appeal a denial of benefits.