Employer-Specific Data From A Multiemployer Plan

[Guest TBurch]

Do multi-employer health and welfare funds track or have the ability to determine employer-specific data -- such as the total amount of claims paid out to/on behalf of all employees/beneficiaries of a specific employer, and how many employees have actually received benefits for spouses, children, etc., in addition to themselves ? Is there any requirement that this be done ?

[Bill Ecklund]

The more sophisticated multi-employer health and welfare funds have the ability to track claims on an employer specific basis. Generally, multi-employer funds to do not want to give out that data, because it ends up being used by employers who may attempt to negotiate out of a health and welfare fund. I am aware of no legal requirement that the health and welfare fund must distribute that information upon request, unless the Trustees have specifically authorized it.

There are also some potential tax ramifications if the fund “experience rates” employers that participate in the fund. There are limitations on fund reserves under section 419(A) of the Internal Revenue Code, which come into play. I am aware of no health and welfare funds that do experience rate the employers that participate in the fund, although in some cases, funds will charge an “entrance fee”. Some health and welfare funds provide several different plans that will cost different amounts and the employer negotiates with the union as to which plan they wish to participate in. Generally, the health and welfare consultants will cost out the experience of each of the separate plans, but that is not done on an employer specific basis. It is done on a plan basis.