Administration Process of Cafeteria Plans

[Guest Guharoy]

Hi,

Can someone explain me the complete end - end process of Administration of Cafeteria Plans? That is how do an administrator (process adopted):

A. Maintain an individual accounting record for each account elected by each individual.

B. Update participants’ accounts semi-monthly during the year with Deposits from employee pre-tax deductions

C. Approve reimbursement payment requests

D. Record the information from reimbursement requests forms

E. Validate participants’ reimbursement request

F. Determine the amounts available for reimbursement payments

G. Provide a flex debit card

H. Generate reimbursement checks and payment registers

I. Produce explanation of benefits statements for employees which identify the expenses which are being reimbursed, preferably as the check stub or an attachment with the reimbursement check

J. Pend unpaid or partially paid dependent care spending account requests and issue additional check(s) in future payment processing additional funds are deposited.

K. Provide reconciliation of bank statements

L. Provide monthly management reports which display participant account activity and current status information

M. Generate quarterly participant account status statements

N. Generate monthly accounting reports for proper audit control: deposit transaction reports, reimbursement request reports, unpaid/partially paid requests, and adjustment reports

O. Provide annual information which reports the amount paid into the dependent care flexible spending accounts for the calendar year

P. Report forfeitures annually after the last payment cycle of the plan year and run-out period.

Q. Report reimbursements in excess of a participants contributions

R. Provide completed annual 5500 required by Section 125

S. Perform the applicable nondiscrimination tests

T. Prepare plan documents and summary plan descriptions.

Thanks in advance

[Ron Snyder]

Pretty good checklist and you still have a few letters of the alphabet left over.

The answer to your question is "yes". Several firms, including flex software vendors, have training programs for administrators of cafeteria plans. Check with your own vendor. If you don't have one, either buy appropriate software (BenefitsLink has a section to look and see what's available), or hire some who already has the software to do the job.

While cafeteria plan administration may not require the same amount of training as defined benefit plan administration, for example, it requires a lot more than a checklist.

[GBurns]

The problem is not the checklist. It is how you accomplish the items on the checklist.

[Guest Guharoy]

The problem is not the checklist. It is how you accomplish the items on the checklist.

Hi George,

Thanks for your reply. Do you have a document that illustrates the items on the checklist and as you said how can I accomplish the checklist. Presently, I do not have time to go for training. It is urgent. If you can let me know where I can look for this information or whom I can contact. A diagramatic workflow is also welcome. Appreciate your help.

Thanks and Regards

Guharoy

[LRDG]

It's a comprenhisive list. Great job.

[GBurns]

It would take some time to find one that is not tied to a particular software package.

Probably the quickest and easiest way to get the details would be, as suggested by vebaguru, to get it from the training provided by and through the software providers.

I would not say that administering cafeteria plans is a quick and easy thing to learn. If this is your outlook, I urge you to reconsider.

For opinions on what can be provided and cost etc try some of the vendors who advertise on BenefitsLink. I do not thiink that giving the names of others would be ethical, assuming without looking, that they are not already on that list.

In any case, administration of employee benefits plans should NEVER be done by the employer/plan sponsor.

[Guest Guharoy]

It would take some time to find one that is not tied to a particular software package.

Probably the quickest and easiest way to get the details would be, as suggested by vebaguru, to get it from the training provided by and through the software providers.

I would not say that administering cafeteria plans is a quick and easy thing to learn. If this is your outlook, I urge you to reconsider.

For opinions on what can be provided and cost etc try some of the vendors who advertise on BenefitsLink. I do not thiink that giving the names of others would be ethical, assuming without looking, that they are not already on that list.

In any case, administration of employee benefits plans should NEVER be done by the employer/plan sponsor.

Thanks George for your valuable inputs. I shall go ahead the way you guys have suggested. Kindly let me know whether Administration of Cafeteria Plans can be provided with deviations from the checklist I have provided. I mean what other different process / method / steps I can incorporate / delete to provide an optimal adminstration process.

[SLuskin]

It would take some time to find one that is not tied to a particular software package.

Probably the quickest and easiest way to get the details would be, as suggested by vebaguru, to get it from the training provided by and through the software providers.

I would not say that administering cafeteria plans is a quick and easy thing to learn. If this is your outlook, I urge you to reconsider.

For opinions on what can be provided and cost etc try some of the vendors who advertise on BenefitsLink. I do not thiink that giving the names of others would be ethical, assuming without looking, that they are not already on that list.

In any case, administration of employee benefits plans should NEVER be done by the employer/plan sponsor.

Thanks George for your valuable inputs. I shall go ahead the way you guys have suggested. Kindly let me know whether Administration of Cafeteria Plans can be provided with deviations from the checklist I have provided. I mean what other different process / method / steps I can incorporate / delete to provide an optimal adminstration process.

We use the DataPath software. It is comprehensive, but on the expensive side. It has been well worth it for us. When I hire someone here, it takes quite awhile to train them to do everything properly, and we have our procedures outlined step by step. DataPath is having an intensiver 2 1/2 training on their software August 27-29. I am sending my assistant VP to that session to make sure we are getting everything out of the sofware that we can. He has been here over 2 years. So, your zeal to get it done immediately might be a little ambitious. Some of us have been administering these plans for almost 20 years and are still learning.

[LRDG]

I'm not familiar with DataPath.

P&W Software is exclusively Cafeteria Plan Administration, with administration add on's for FSA billing, premium billing, rates, etc. I met the the principals 15+yrs ago and again 5 yrs ago. The integrity, knowledge and support is high level, and very professional. I have no interest in this or any other organization, just recomendation based on my first hand knowledge of the organization. High end cost, not cheap.

[Guest Guharoy]

It would take some time to find one that is not tied to a particular software package.

Probably the quickest and easiest way to get the details would be, as suggested by vebaguru, to get it from the training provided by and through the software providers.

I would not say that administering cafeteria plans is a quick and easy thing to learn. If this is your outlook, I urge you to reconsider.

For opinions on what can be provided and cost etc try some of the vendors who advertise on BenefitsLink. I do not thiink that giving the names of others would be ethical, assuming without looking, that they are not already on that list.

In any case, administration of employee benefits plans should NEVER be done by the employer/plan sponsor.

Thanks George for your valuable inputs. I shall go ahead the way you guys have suggested. Kindly let me know whether Administration of Cafeteria Plans can be provided with deviations from the checklist I have provided. I mean what other different process / method / steps I can incorporate / delete to provide an optimal adminstration process.

We use the DataPath software. It is comprehensive, but on the expensive side. It has been well worth it for us. When I hire someone here, it takes quite awhile to train them to do everything properly, and we have our procedures outlined step by step. DataPath is having an intensiver 2 1/2 training on their software August 27-29. I am sending my assistant VP to that session to make sure we are getting everything out of the sofware that we can. He has been here over 2 years. So, your zeal to get it done immediately might be a little ambitious. Some of us have been administering these plans for almost 20 years and are still learning.

Would you have any idea about the most popular software regarding flex admin? Also a workflow process of Flex Admin will be appreciated.

Thanks

[Ron Snyder]

You might start by looking at these: BenefitsLink or simply by Googling the web for "125 flex plan administration software".

[Jacmo]

I might add that if you do it right, you will work very long hours and not make a lot of money.

[Guest Sieve]

. . . and, Jacmo, unfortunately you will be competing against a lot of incompetents who know nothing about cafeteria plans and think it is an easy way to make a buck as an add-on to their pension administration services (no offense intended to those who do it well).