coverage (70% or ABPT)

[Guest greggi39]

ex. 1 hce and 4 nhces. ER wants to exclude 2 from plan, so it fails 70%. but it will pass the general test and abpt and f&C test. some confusion here, one owner says the plan needs to pass coverage (70% ) before calc'ing ebars. the doc allows to pass by the abpt unless the plan chooses "add back " . why would this plan need to pass 70% ?

[Tom Poje]

if plan excluded ees by name (or something similar to that effect) then you fail reasonable classification, so you fail average benefits test.

see 1.410(B)-4(B)

so it depends on how they are excluded from the plan.

[Guest greggi39]

they would be excluded by job classification.

[AndyH]

Then you are in a gray area. You need to satisfy the requirements of 1.410(B)-4 which states in part that a classification is reasonable if "a classification is established by the employer in accordance with this paragraph (B) if and only if, based on all the facts and circumstances, the clasification is reasonable and is established under objective business criteria ......".

It then goes on to give some examples. I have heard a wide variety of opinions on what satisfies this standard. Your best bet is to seek a Favorable Determination Letter by demonstrating satisfiction of coverage by satisfying average benefits. And request a ruling on this matter specifically.