Nondiscrimination Testing

[Chaz]

Can anyone recommend an actuary or other professional that is very experienced and comfortable with the morass that is the regime of welfare plan nondiscrimination tests (self-insured medical plan, cafeteria plan, DCAP, etc.) for a possible engagement to perform these tests for a foreign headquartered employer with numerous U.S. entities within a common control group?

Or is this a facetious question?

Thanks.

[Guest morris]

Chaz--some TPAs have the capability but they usually require the input of census data and let their admin software run the tests--which makes you wonder--did the software supplier/programmer fully understand benefits law?

If I were in your shoes, I would buy a good manual (like EBIA's "Cafeteria Plans" manual) which spells out in detail how to run each test. You need to have at least a good overview of what's needed before you can hire someone to do it--you need to know the right questions to ask.

Good luck!

[Chaz]

Thanks for the feedback. We have the EBIA books and they are very helpful in advising our client but we are not in the position to perform the actual tests on a cost-effective basis.

I guess the answer is self-evident to the question of why there are firms willing and able to do testing with respect to qualified retirement plans but are not able to do so with welfare plans, but it is frustrating.

[Guest morris]

If I'm not mistaken, qualified retirement plans require proof of being able to pass their A/D tests. So there is enough volume for someone to be able to stay competent and make money at it.

Not so for other welfare plans. In other words, there's currently no enforcement of the A/D requirements, so no one is competent, or if they are, they can't be found.

For instance, if I thought there were a big enough of a demand, I'd personally gear up for wide scale A/D testing. But I don't see that happening, until the government starts auditing and penalizing plans.

[FormsRstillmylife]

Check out conradsiegel.com -- I might be employed there and be prejudiced, but it is a good actuarial company with a health and welfare benefits department.

[Guest odessa477]

First of all, you have to read EBIA manual first.