Employer Benefit Plan Actions For the End of the Year


2013 marks not just the start of a new calendar year, but also compliance obligation deadlines for some employee benefit plans. The F and P Benefits Group has outlined a number of key provisions impacting welfare and retirement plans, as well as changes to your payroll system.

This isn’t sexy material, but errors could be costly.

Medical Plans

 A Summary of Benefits and Coverage (SBC) must be provided to all group medical plan enrollees by the first day of the first annual open enrollment period beginning on and after September 23, 2012. This means if your medical plan is operated on a calendar year basis, you must provide SBCs to enrollees as part of your upcoming annual open enrollment period for coverage that takes effect January 1, 2013.

 Health FSAs must be redesigned for the 2013 plan year to limit annual account balances to $2,500. Make sure to update your plan document as well.

 Ensure that your group health plan SPDs have been properly amended to reflect any applicable changes under the Patient Protection and Affordable Care Act of 2010 (PPACA).

 Claims’ correspondence (claims and appeals responses) must use “culturally and linguistically appropriate language” when 10%+ or more of employees reside in a county literate only in the same non-English language. The HHS website provides a list of all U.S. counties which meet or exceed the 10% threshold. If you send a claims or appeals response to an address in a county that meets the 10% threshold, you must include a one-sentence statement in the relevant non-English language indicating how to access language services. You must also provide oral language services (such as a telephone customer assistance hotline) and, upon request, a notice in any applicable non-English language.

 The Women’s Health and Cancer Rights Act of 1998 (WHCRA) requires group medical plans to provide an annual written notice to participants and beneficiaries of the availability of medical and surgical benefits under the plan with respect to mastectomy and breast reconstruction. Including the WHCRA notice as part of your open enrollment materials is one way to fulfill your annual notice obligations.

 Sponsors of group medical plans must notify employees annually concerning the availability of state premium assistance through Medicaid or CHIP. The Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) imposes this notice requirement, which can be met by including the DOL’s model “Employer CHIP Notice” as part of your annual open enrollment materials. For calendar year plans, the Employer CHIP Notice must be provided no later than January 1, 2013 .

Qualified Retirement Plans

 If you sponsor a Safe Harbor 401(k) Plan, you must prepare and distribute the annual safe harbor notice to all eligible employees for the 2013 plan year by no later than December 1, 2012.

 401(k) plans operated on a calendar year basis must provide participants and beneficiaries with an annual written notice about the qualified default investment alternatives (QDIA) offered under the plan by December 1, 2012. This notice cannot be provided as part of an SPD or SMM.

 January 31, 2013 marks the end of the second five-year remedial amendment cycle and deadline for filing of a determination letter request for a Cycle B plan. To preserve reliance on the plan’s continued tax qualification, plan sponsors of Cycle B plans (meaning sponsors with an EIN ending in digits 2 or 7, and sponsors of multiple employer plans) need to ensure that their plans have timely adopted all interim and discretionary amendments and that determination letter requests are submitted to the IRS no later than January 31, 2013.

Payroll Changes

 Employers who filed more than 250 Forms W2 for 2011 must begin reporting the aggregate cost of employer-sponsored health coverage provided to employees in 2012 on Form W-2 reporting required to be sent out by January 31, 2013.

 Beginning in 2013, the “Additional Medicare Tax” must be assessed on individuals earning more than $200,000 or married couples filing jointly earning more than $250,000. The Additional Medicare Tax rate will add 0.9% to the amount that some individuals will have to pay in 2013. The additional 0.9% will kick in only when the wages paid to an individual for the 2013 calendar year go above $200,000. It should be noted that this an additional tax that will apply only to individuals – there is no employer matching requirement. Be sure you consider all forms of compensation when determining when an employee’s wages exceed $200,000, including the imputed cost of group-term life insurance coverage in excess of $50,000, noncash fringe benefits and receipt by an employee of third-party sick pay. The IRS expects to release revised Forms 941 and 943 in the future.

About mavity2012

I am a Senior Partner operating out of the Atlanta office of Fisher & Phillips LLP, one of the Nation’s oldest and largest management employment and labor firms. My practice is national and keeps me on the road or in one of our 28 offices about 50 percent of the time. I created and co-chair the Firm's Workplace Safety and Catastrophe Management Practice Group. I have almost 29 years of experience as a labor lawyer, but rely even more heavily on the experience I gained in working in my family's various businesses, and through dealing with practical client issues. Employers tell me that they seldom meet an attorney who delivers on his promise to provide practical guidance and to be a business partner. As a result, some executives probably use different terms than “practical” to describe my fellow travelers in the profession. I don't enjoy the luxury of being impractical because I spend much of my time on shop floors and construction sites dealing with safety, union and related issues which are driven by real world processes and the need to protect and get the most out of one's most important business assets ... its employees. That's one of the reasons that I view safety compliance as a way to also manage problem employees, reduce litigation and develop the type of work environment that makes unions unnecessary. Starting out dealing with union-management challenges and a stint in the NLRB have better equipped me to see the interrelationship of legal and workplace factors. I am proud also of my experience at Fisher & Phillips, where providing “practical advice” is second only to legal excellence among the Firm’s values. Our website lists me as having provided counsel for over 225 occasions of union activity, guided unionized companies, and as having managed approximately 450 OSHA fatality cases in construction and general industry, ranging from dust explosions to building collapses, in virtually every state. I have coordinated complex inspections involving multi-employer sites, corporate-wide compliance, and issues involving criminal referral. As a full labor lawyer, I oversee audits of corporate labor, HR, and safety compliance. I have responded to virtually every type of day-to-day workplace inquiry, and have handled cases before the EEOC, OFCCP, NLRB, and numerous other state and federal agencies. At F & P, all of us seek to spot issues and then rely upon attorneys in the Firm who concentrate on those areas. No tunnel vision. I teach or speak around 50 times per year to business associations, bar and professional groups, and to individual businesses. I serve on safety committees at three states’ AGC Chapters, teach at the AGC ASMTC
This entry was posted in aging workforce, employer benefit plans, employer policies, food processing, hospitality, manufacturing, Patient Protection and Affordable Care Act of 2010, wellness and tagged , , . Bookmark the permalink.

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