Form 5500 for H&W plan & participant counts

[alexa]

What counts does one put on Form 5500 for a H&W plan- is it just those enrolled in medical or anyone who is eligible to enroll?

Does everyone eligible to enroll get an SPD and SAR or just those actually participating?

thanks

Lexy

[GBurns]

Whatever the particular line asks for, actives, retired etc. If you read the instructions to mean that an active is anyone eligible rather than meaning a enrolled participant, that is your decision.

Usually everyone gets the information, but that is sometimes for simplicity and safety. If you have 80% participation, 85% eligible, why spend time sorting out the few remaining people ? What happens if, in sorting, a mistake is made ? It is cheaper, easier and safer to send the SPD and SAR to everyone.

[J Simmons]

Everyone eligible gets an SPD, within 90 days of becoming eligible.

Page 17 of the 2007 Form 5500 Instructions includes the following provisions:

For welfare plans, the number of participants should be determined by reference to 29 CFR 2510.3-3(d), which provides that an individual becomes a participant covered under an employee welfare benefit plan on the earlier of: the date designated by the plan as the date on which the individual begins participation in the plan; the date on which the individual becomes eligible under the plan for a benefit subject only to occurrence of the contingency for which the benefit is provided; or the date on which the individual makes a contribution to the plan, whether voluntary or mandatory. Dependents are considered neither participants nor beneficiaries. A child who is an “alternate recipient” entitled to health benefits under a qualified medical child support order should not be counted as a participant for lines 6 and 7. An individual is not a participant covered under an employee welfare plan on the earliest date on which the individual (A) is ineligible to receive any benefit under the plan even if the contingency for which such benefit is provided should occur, and (B) is not designated by the plan as a participant. See 29 CFR 2510.3-3(d)(2).

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Before counting the number of participants in welfare plans, it is important to determine whether the plan sponsor has established one or more plans for Form 5500 reporting purposes. As a matter of plan design, plan sponsors can offer benefits through various structures and combinations. For example, a plan sponsor could create (i) one plan providing major medical benefits, dental benefits, and vision benefits, (ii) two plans with one providing major medical benefits and the other providing self-insured dental and vision benefits, or (iii) three separate plans. You must review the governing documents and actual operations to determine whether welfare benefits are being provided under a single plan or separate plans.

The fact that you have separate insurance policies for each different welfare benefit does not necessarily mean that you have separate plans. Some plan sponsors use a “wrap” document to incorporate various benefits and insurance policies into one comprehensive plan. In addition, whether a benefit arrangement is deemed to be a single plan may be different for purposes other than Form 5500 reporting. For example, special rules may apply for purposes of HIPAA, COBRA, and Internal Revenue Code compliance. If you need help determining whether you have a single welfare benefit plan for Form 5500 reporting purposes, you should consult a qualified benefits consultant or legal counsel