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Department Of Labor Audits

Have you heard that the DOL expressed its goal to audit all employee benefit Plans by the end of 2015? Is this a feasible task? With increasing budgets and resources, DOL activity is hitting employers hard and only getting stronger.

Are you prepared for a DOL audit? Have you prepared your staff for what an audit involves and the fines for non-compliance?

A health and welfare Plan audit is a review of documents and other Plan materials to ensure Plan Sponsors comply with federal law. This includes having and distributing the correct documents, and administering those documents consistent with federal laws and regulations. A DOL Plan auditor reviews many things, each aimed at compliance or a host of fines for non-compliance. Following is a list of items examined from recent DOL audits:

1) ERISA Plan documents from 2012-2014.

2) Summary Plan Description (SPD) from 2012-2014, including any changes in Plan benefits and entitlement to benefits. Please indicate the date of the SPD and the most recent date and method of distribution.

3) Summary of Benefits and Coverage (SBC), Notices of Material Modifications, and Uniform Glossary.

4) Copies of the 2012-2014 annual open enrollment information.

5) Copies of the employee handbook describing or explaining the Health Plan eligibility and benefits.

6) All contracts with insurance companies for the provision of health benefits.

7) If self-insured, all contracts, fee schedules, and written guidelines/procedures for:

a. Claims processing (including claims installation documents);
b. Administrative services including utilization review and claim appeals; and
c. Reinsurance

8) Documents which describe the responsibilities of both the employer and employees with respect to the payment of the costs associated with the purchase and maintenance of health and welfare benefits.

9) In accordance with the Health Insurance Portability and Accountability Act of 1996, please provide the following records:

a. Copy of the Plan Rules for Eligibility to enroll under the terms of the Plan (including continued eligibility).
b. Sample copy of a Certificate of Coverage provided to an employee who lost health care coverage after December 1, 2012, which certifies creditable coverage earned under this Plan;
c. Copy of the record or log of all Certificates of Creditable Coverage for individuals who lost coverage under the Plan, or requested certificates from January 1, 201 3;
d. Copy of the written procedure for individuals to request and receive Certificates of Credible Coverage;
e. Copy of the necessary criteria for an individual without a Certificate of Creditable Coverage to demonstrate creditable coverage by alternative means;
f. Sample General Notice of pre-existing condition informing individuals of the exclusion period, the terms of the exclusion period, and the right of individuals to demonstrate creditable coverage (and any applicable waiting or affiliation periods) to reduce the pre-existing condition exclusion period, or proof that the Plan does not impose a pre-existing condition exclusion;