Strategies to ensure successful compliance
Since the enactment of ERISA and the Affordable Care Act (ACA), organizations have been faced with implementing—and communicating— more than 80 employee benefit regulations, many of which require documents to be shared with employees.
Summary Plan Descriptions (SPDs), Summaries of Benefits and Coverage (SBCs), Summaries of Material Modifications (SMMs) and a myriad of required notices all come with requirements for content, readability and distribution. And many of these documents are associated with civil and even criminal penalties for non-compliance. That’s a lot to juggle.
Key benefits to working with Optavise
Reduced litigation risk
Reduced risk of fines, penalties and back benefit awards
Dramatically reduced costs and improved efficiencies
Improved participant understanding and appropriate use of benefit plans
Improved healthcare consumerism and cost conscious behaviors
Do more with Optavise
Our team combines decades of experience communicating employee benefits with a deep and broad knowledge of employee benefits plans and the associated regulations.
The world of employee benefits is increasingly complex. With healthcare literacy at an all-time low and changes to both regulations and plan offerings the norm rather than the exception, benefits communication must be a year-round effort, not just something that happens at open enrollment.
The average individual sees 5,000 ads a day. Add to that the news stories, emails, Twitter postings, IMs and other messaging, as well as materials sent from their employer and multiple vendors, and it’s no wonder benefits communications get lost or drowned out. Chances are the first few times you tell your employees something about their benefits, it won’t completely register with them.
Summary of Benefits and Coverage (SBC)
SBCs must be distributed at initial enrollment (by the first date an individual can enroll in coverage), at open enrollment (no later than 30 days before the beginning of the next plan year), during HIPAA special enrollment (no later than 90 days after enrollment) and on request (no more than seven business days after a request). And failure to distribute SBCs on a timely basis can be expensive. Further, SBCs have the potential to be a valuable tool for employees to compare plan offerings. Yet too often, employees don’t understand what these documents are for and how they can be used.
Summary Plan Description and Summaries of Material Modification
One of the most burdensome tasks for many employers is the creation, management and distribution of Summary Plan Descriptions (SPDs).
SPDs require a significant amount of time, resources and manual effort—especially if they have not been kept current. Because an SPD is meant to summarize—in language the average plan participant can understand—the provisions of a plan (as well as the rights and responsibilities of both the participant and the employer) the process of updating—or oftentimes creating—an SPD can be daunting. Contracts, certificates and plan documents must be reviewed, steps must be taken to confirm that the plan is actually being administered under the terms of the contract and plan document and as the employer intended—AND that the plan is in compliance with current regulations. Further, attorneys often pinpoint plan provisions that might need clarification—all before content is finalized. The Optavise team has decades of experience consolidating this content into clear, readable, and compliant SPDs.
For employers who prefer not to update their SPDs each year, Optavise can create summaries of material modification to explain plan changes.
SPDs and other compliance materials are a critical source of information about an employer’s benefit plans.
Yet a study by the Employee Benefit Research Institute (EBRI), found that important information contained in many SPDs is written at a reading level that may be too difficult for the average plan participant. In fact, the average level of readability for SPDs is higher than the recommended reading level for technical material. More recently, the Government Accounting Office (GAO) reviewed 10 model notices from the agencies (often used by employers in SPDs) against federal plain language guidelines and found that several of the model notices failed to meet those guidelines.
Our team can assess the readability of your materials and provide concrete recommendations to dramatically improve the reading level and user-friendliness.
Legal notices brochures
Each year, plan sponsors face a growing list of disclosure requirements for welfare plans. Some notices are tied to healthcare reform (such as grandfathered status or the notice of coverage options). Other notices are tied to Title 1 of ERISA. And then there’s Medicare Part D, CHIPRA, WHCRA…and more. Whether a plan is insured or self-insured, it’s the responsibility of the plan sponsor to comply with these disclosure requirements and determine who is providing what notice. For many employers, a stand-alone booklet serves this purpose.