Need for a Trust

[Guest Donaldson]

Does anyone know the rules for when an employer must set up a trust for the following plans: (i) a self-funded medical plan, and (ii) vision and dental plans are paid for entirely by employees.

I know that ERISA has an exception and does not require a trust for plans that consist of insurance contracts or policies.

Thank you for any assistance.

[mbozek]

A trust is required only for a plan that has assets. If there are no assets, e.g., because the employer reimburses the employees directly for med expenses or the er sends the premiums to the insurer, there is no need for a trust.