Mary Rosen, the Associate Regional Director of the United States Department of Labor for New England including Upstate New York gave a presentation Wednesday on common issues with health care plans. She also described six tips for common plan errors and three new initiatives the DOL is working on.
This seminar hosted by Anthony Stevens was a very good opportunity to hear what issues the Federal DOL is focused upon.
Based upon common errors seen by the DOL the six tips for health care plan fiduciaries to consider are:
1. Carefully select and monitor service providers
- Document the process of selecting the service providers; include the data that was reviewed;
- Confirm the fees and expenses paid a plan are reasonable;
- Monitor plan service providers.
2. Make required disclosures to participants and beneficiaries
- Make sure the SPD (Summary Plan Description) is complete and written in plain English;
- Furnish the SPD to participants within 90 days of coverage; redistribute every five years;
- Distribute the SMM (Summary of Material Modifications) or an updated SPD if materials changes made.
3. If a request for disclosure is made, disclose as much as possible
- Deliver disclosures by hand delivery, by U.S. mail, by electronic delivery (if certain standards are met);
- Posting in a common work area is usually not enough.
4. Understand your plan and your responsibility
- Read and understand plan document and the SPD;
- Follow the terms of the plan;
- Do not use personal discretion in interpreting the terms of the plan;
- Make sure claim procedures are followed, including time limits for response for claims.
5. Make timely contributions and monitor use of plan assets
- See safe harbor regulation 2510.3-102;
- Relief can be granted under DOL Technical Release 92-01;
- Be aware of classification of the Medical Loss Ratio Rebate (MLR), and see
DOL Technical Release 2011-04; - Be watchful for prohibited transactions.
6. File reports with Government and keep good records
- Form 5500 series return must be filed unless an exemption exists;
- If a third party administrator is hired, make sure you understand what they are doing, as the duties to maintain records cannot be delegated.
Federal Department of Labor Health Care Plan Initiatives described by Ms. Rosen:
1. Health Benefit Security Project:
A comprehensive national health enforcement project combining the ESBA (Employee Benefits Security Administration) health plan enforcement initiatives with the new protections under the Patient Protection Affordable Health Care Act of 2010.
2. Self-Funded Health Case Fees Initiative:
This project seeks to uncover hidden fees in self-funded health plans. The project includes the review of fees commonly found in self-funded health plans including base medical service fee, recovery of overpayments, subrogation, corporate group and third party revenue, medical benefits drug rebate payments, stop-loss premiums and other fees and services.
3. Emergency Services Project
A project to determine if health care plans are complying with the Patient Protection requirements of the Affordable Care Act with respect to the coverage of emergency services. This project will 1) identify large self-funded health plans 2) that provide coverage for emergency services and 3) determine if services will be covered and whether the plan is properly reimbursing for out-of-network emergency room visits.