On November 21, 2000 the Department of Labor (DOL) published regulations on the information that must be included in Summary Plan Descriptions (SPD) for both pension and welfare benefit plans. Over the next couple years the regulations were finalized. With the introduction of the Affordable Care Act, “Erisa” SPD requirements are receiving new attention.
Employers are required to provide a Wrap SPD to all eligible employees and maintain a Wrap Plan Document or incur a penalty. This requirement applies to all employers/organizations, no matter what size, except government agencies and churches. The government is reviewing this requirement more carefully and increasingly performing audits to ensure employer compliance.
What is an SPD? Employers who offer benefits (referred to as “health and welfare” benefits: medical, dental, vision, life, DI, wellness and employee assistance plans) subject to ERISA are required to distribute a “summary plan description” (SPD) to participants, which describes (in a readable summary form) the key terms of the plan (such as benefits offered, eligibility requirements, and costs) and includes other mandated information (such as plan sponsor information). In other words – an overview of the benefits being offered with carrier information.
What are the penalties? Employers/plan administrators may be liable for serious penalties if they don't provide an SPD or have a current plan document:
Failure to provide an SPD or plan document within 30 days of receiving a request from a plan participant or beneficiary can result in a penalty of up to $147/day per participant or beneficiary for each violation.
Lack of an SPD could trigger a plan audit by the U.S. Department of Labor (DOL).
Failure to furnish to the DOL any requested information relating to the employee benefit plan can result in a penalty of up to $149 per day (not to exceed $1,496 per request).
In order to prevent your groups from incurring a possible penalty, we have an easy solution that will help satisfy this Erisa requirement. We will collect the information from your groups and provide a Wrap SPD/Wrap Plan Document. We will do all of this for an annual fee - $299 initial year set-up and $150 annual maintenance thereafter. We feel our fees are competitive with what others may charge and highly recommend you recommend this to your groups.