HRA Plan Document Problem

[Guest AEC]

We have come across a bad situation with an HRA plan, and I would like to see if any of you have any insight on how to handle this problem.

A CPA came to us to have us set up an HRA plan. We drafted plan documents per his request for a group of doctors, giving coverage of $10,000 per year for each employee. The plan document was adopted and SPD's were distributed to each of the doctors. The problem is that the employer actually intended that the level of coverage be $4,000 per employee per year, and the CPA gave us bad information. Now they have an employee who has submitted claims for $10,000 and wants to be reimbursed, and the employer only wants to give him $4,000. The existing plan document does provide for $10,000 of coverage. (Of course, nobody actually bothered to look over or read the document prior to signing.)

Do any of you have any prior experience with a similar situation or ideas on what can be done? Can an amendment be drafted? Are they stuck reimbursing this guy for the full $10,000? I would really appreciate any advice. I guess there is going to be a big meeting with attorneys later today.

[WDIK]

Hopefully, you have the "bad information" provided to you by the CPA in writing to justify your position in case anyone remembers their instructions differently.

With regard attempts to change an executed document that contained "errors", you will probably have to defer to the attorney's big meeting.

[oriecat]

Wow, that's some mistake. That'll teach em to read their plan docs before signing...