I have a forest with a lot of trees, so I'd appreciate someone looking over my shoulder while I think this one through. I have a group of emergency room physicians that presently sponsors a mp/ps combination. There group consist of 5 owner- and 7 non-owner physicians. All are HCEs. There is one office manager, who is a NHCE. The OPs want to establish a DB plan with different levels of benefits to accomodate different doctors' contribution requirements. The NOPs will be excluded from the new db plan but will continue to participate in the mp/ps combo. The testing issues as I see them are as follows:

1.The office mgr must be in the db plan in order to pass 401a26.

2.The dc and db plans must be aggregated in order to pass 410b, and therefore for 401a4 (unless some new NOPs come in as NHCEs due to insufficient prior year comp).

3. If I have to aggregate for a4 I have to create aggregate accrual/allocation rates, as per 1.401a4-9b2, even though no single participant will have a truly aggregate rate. If I test on benefits my db guys will have NAR/MVARs, and my dc guys will have equivalent accrual rates. If I test on contributions my db guys will have Normal and Most Valuable Allocation Rates, and my dc guys will have their regular allocation rates.

4.If I impute disparity I have to do it on the "aggregate " rate determined above, using db or dc rules as appropriate.

5.As long as there is no common payroll I don't have a 25% limit for 404a7.

Anyone with any other thoughts or comments? Have I missed anything?

Here is the scenario:

An underfunded DB plan experiences a partial termination when a sizable portion of its participants depart. The plan generally permits lump sum distributions (don't ask--not my idea) upon a termination of employment. The plan document is silent as to the timing of distributions, but they have historically been made "as soon as reasonably practicable" following termination of employment. The plan sponsor would like to sit on the distributions for a while (because of that massive increase in the plan's assets that's just around the corner--what can I say? They're optimists).

There are obviously exclusive benefit issues here and waiting too long runs the risk of encouraging participants to seek assistance from DOL and/or PBGC. Nevertheless, plan sponsor is trying to find the "line" so as to avoid stepping over it.

Anyone have any thoughts on this?

Thanks!

I've got a calendar year 401(k) plan that is subject to a 3% non-elective Safe Harbor contribution committment. A 50% shareholder is leaving the company. Although the remaining shareholder intends to continue company operations, she wants to scale back on overhead committments as much as possible. Specifically, she'd like to end the company's 3% contribution committment.

It'is my impression that the company cannot revoke a non-elective contribution in the middle of the year. However, if the plan is terminated completely, it would seem the safe harbor committment would have to come to an end.

1. Has anyone seen guidance (or have an opinion) on this question?

2. Do you think there's an advance notice requirement (under ERISA section 204(h), or by parallel to the guidance in Notice 2000-3 - applicable to the halting of Safe Harbor Matching contributions)?

Thank you very much

The claims get stranger and stranger. A participant has requested reimbursement for the cost of a bra -- the participant has received treatment for neck and back pain and the doctor has recommended a bra with "extra support". If reimbursable, should we ask for a letter of medical necessity? Is the cost of the bra only reimbursable to the extent that the cost of the special bra exceeds the cost of a regular bra?

What do other TPAs request for substantiation for expeneses associated with supplies (i.e. Ace bandages). I know expenses associated with medical supplies may be reimbursable if the supply is used to treat a specific medical condition, and isn't a personal comfort item. Should the receipt be accompanied by a letter of medical necessity or a prescription written by a physician?

Thanks!

I am trying to figure some stuff out regarding our welfare plans.

1. Without a ‘wrap-around’ plan document to bundle any/all of the plans into one “Plan”, are separate 5500 filings required? (We have previously filed one 5500 for the medical, dental, life plan and one for the Section 125 plan. We do not seem to have a wrap-around document bundling the plans. We only have a very old SPD that lists the benefits as one plan, but it is no longer current with ERISA SPD requirements.)

2. Are there any possible consequences if a single 5500 has been filed, but there is no wrap-around document, or if it is lost or out of date?

3. If plans are not bundled, can enrollment in one plan be contingent upon enrollment in a separate plan? For example, we require employees to elect both medical and dental coverage. If they are not bundled together, can that be required?

Thank you!!

a plan is top heavy in 2000, 2001 and 2002. The 2002 minimum contribution was made. The 2000 and 2001 contributions have not been made, because TH was "discovered" in 2002.

Do the minimum contributions to be allocated have to be adjusted for earnings? Point me to the right section of the regs/rulings!!!

Thanks!

I know that the health PLAN is the covered entity and not the employer, although the employer sponsors the plan. I also know that if the employer has no access to PHI other than summary health information and enrollment information that it avoids the privacy requirements under HIPAA and the insurer of the fully-insurer plan has to deal with it.

However, what does this mean in "real life"? The employers we work with definitely want to go the hand-off approach, but yet have copies of the enrollment forms in their files, which contain PHI. Do they have to go through all the Privacy rules in order to keep the PHI in their files? My impression is the as long as the INSURER doesn't provide anything outside of summary health information and enrollment info, but this is PHI that the employer has in their files for the health plan, acting as the plan sponsor.

What steps should the employer take? Full out Privacy rules or something as minimal as locked files for the enrollment forms?

Many?s

If you have a Cross Tested 401(k) Safe Harbor plan, and the eligibilty for the cross tested portion is two years and the Safe Harbor is only one year, are those people would just be eligible for the Safe Harbor also required to be brough into the plan early for the cross tested portion so that they pass gateway?

Please advise!

Thanks

We are the plan sponsor of a prototype document, used by many employers. The plan assets are held in accounts with us. So technically, we could be the custodian as in having custody of?

The schedule P requires the signature of a fiduciary (or custodian). I think, with respect to the schedule P, custodian means custodian of an ERISA 403(B), not a 401(a) plan. This means that for a 401(a) plan, we must not sign as fiduciary, the trustee or other fiduciary as designated by the plan, should sign as fiduciary. Am I Right?

I would appreciate any feedback on the following questions:

1) Since a PEO is a co-employer of a large number of companies, do all of the companies affiliated with the PEO have to live under one Sec 125 plan? (I assume all of the companies are "affiliated companies" under Sec 125.)

2) Can a PEO member company opt out of the PEO's Sec 125 plan and have its own? If yes, then could each member company operate under a separate Sec 125 plan? (Again, I assume this MIGHT be permissable if the PEO as a whole can pass nondiscrim tests.)

3) Alternatively, could a PEO have several Sec 125 plans with different plan years where each member company would choose which plan year cycle they prefer and be housed under that plan?

Just trying to think through if there are ways for PEO members to have more flexibility than just adhering to one plan/plan year. It seems like this could be a sticky area.

Thanks for your input!!

An employee who has worked slightly less than 12 months is out on short-term disability leave. During this time, the employee is offered COBRA. A short time later, the employee reaches the 12 months of employment required to be eligible for FMLA. In this situation, is the employer required to pay any part of the employee’s medical coverage while on FMLA? Or, since the employee was offered COBRA prior to being eligible for FMLA, is the employer only required to return the employee to the same or similar position and not required to do anything with the medical insurance? Any thoughts?

We have a client that has received notification from a collection agency seeking reimbursement because Medicare paid primary when it should have paid secondary. The services were provided 7 years ago, however, the client's tpa was provided with the notice within the 3 year statute of limitations. Is there anyway for the client to get off the hook because the client (the employer) itself did not receive notice within the appropriate statute of limitations period?

I know you can't have deferrals prior to the signing of a plan document. Does that apply to individual 401(k)'s whose plan sponser is an s-corp? I don't believe so but are there any section citings that I can provide to the client telling him that he can't as his financial advisor is adamant that he can.

Hi. I have one plan that I missed sending out 1099-R's for two different participants. Each participant rolled their money over, so there was no withholding incurred. I also did not file the 1099-R's or the 1096 with the IRS.

What do I do?

I've searched this site extensively and can't find an answer to my specific "dilemma"! Thanks for your help!

mno

If a child is receiving inpatient treatment in another state, can a parent claim lodging and travel expenses associated with going back in forth between the facility and home? The patient is not traveling with the parent. The parent returns home (in another state) once a week and then returns to treatment site to visit the patient.

A plan allows participants to invest in insurance. Is it okay for a participant to have a policy on someone else's life other than their own for a qualified plan?

When a fully-insured Plan Sponsor collects premiums, for example COBRA premiums, is the Plan Sponsor performing a plan administration function that requires it to meet the HIPAA privacy plan document and firewall requirements? Or can this be considered solely enrollment information that falls within the exception?

I have a plan that only requires six months to enter the plan and no age. We have a participant who is 17 and they want to exclude her from safe harbor or in general any employer contribution. Can this be done when the plan document does not specify it and if so what reg./etc. should I be looking at?

Can waiver of premium be provided in life policy insuring a participant either in a 412i or split funded db?

I've found nothing saying yes or no.

Any direction would be appreciated.

How long do you have to/should you keep them?