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100% Voluntary Dental on 5500

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H&W plans are not my area of expertise, but I have been asked to complete the 5500 for a client using our software.

They have over 1,000 participants in their medical benefits plan, which included employer funded Dental & Vision benefits for which they have filed 5500s for many years.

They recently changed the Dental & Vision benefits to be 100% employee funded. They deduct the premiums and forward them to the insurance company. They were under the assumption that those two benefits no longer needed to be included in the 5500 reporting. I have been unable to find anything that would support that view. In my ingorance, I assume that since they are choosing the provider, deducating and transmitting the premiums, that it is part of their Health plan and should be reported.

I don't know if the D & V premiums are deducted pre-tax or not, if that makes a difference.

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The dental and vision benefits would not be ERISA benefits and thus would be exempt from the Form 5500 requirement if (i) the benefits are completely voluntary, (ii) there are no employer contributions, and (iii) the employer does not "endorse" the benefits.

It appears that the first two requirements are met. The third requirement is extremely fact-specific and there is not a lot of DOL guidance on the topic. Employers are permitted to collect and remit premiums without losing the exemption but if participants pay the premiums on a pre-tax basis through a cafeteria plan, the conservative approach is to consider the benefits as ERISA benefits.

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