HRA question

[Belgarath]

A question came up on a HRA. I was able to obtain a copy of the Plan document, and the language is, shall we , a bit sparse, and not terribly enlightening. But here goes. 

Plan was established in 2008. In the adoption agreement, under "Maximum Benefits Per Coverage Period" it says: 

"Other: A discretionary amount to be announced by the Employer at the beginning of each Coverage Period." It then goes on to list the maximums for 2008.

So here's the question - the coverage limits have been increased several times since then. Do you think this language would be sufficient, if the amounts are properly communicated to employees each year, or should a Plan amendment have been done each time the limits increased?

[Brian Gilmore]

4 hours ago, Belgarath said:

"Other: A discretionary amount to be announced by the Employer at the beginning of each Coverage Period."

I wouldn't consider that approach to need an amendment for each increase.

[Peter Gulia]

But the plan's administrator would keep in its records the employer's written announcements, right?

[leevena]

Question for Peter and Brian.  Would it not be better to change the plan document wording to something along the lines of "A discretionary amount to be announced by the Employer at the beginning of each Coverage Period" and eliminate the specific number?

[Belgarath]

Brian and Peter - I only have a copy of the document, but I'd LIKE to think they kept records of such notification. Thank you both for your comments. Leevena - good question, I'll be interested to see how they respond.

[Chaz]

Assuming that the adoption agreement is incorporated as a part of the plan and as long as someone keeps a record of the annual maximum amounts and the amounts are approved subject to the company's regular corporate governance procedures, I don't see a need to revisit this provision.

If the plan has not been revised since 2008 and is "a bit sparse, and not terribly enlightening," however, perhaps a review by counsel might be in order.