Self-Funded Benefits Plan Approval Request Under Service Contract Act ("SCA")?

[RodeoWrigley]

I've been having trouble finding information about self-funded health benefits plan approval requests under the Service Contract Act. The regulation is only three short sentences, and doesn't give much to go by: 

Quote

29 CFR § 4.171(b)(2) A contractor may request approval by the Administrator of an unfunded self-insured plan in order to allow credit for payments under the plan to meet the fringe benefit requirements of the Act. In considering whether such a plan is bona fide, the Administrator will consider such factors as whether it could be reasonably anticipated to provide the prescribed benefits, whether it represents a legally enforceable commitment to provide such benefits, whether it is carried out under a financially responsible program, and whether the plan has been communicated to the employees in writing. The Administrator in his/her discretion may direct that assets be set aside and preserved in an escrow account or that other protections be afforded to meet the plan's future obligation.

I found a thread from 2004, but I am wondering if anyone is willing to share more recent experience and insight regarding self-funded plan approval requests. 

Thanks!

[leevena]

Little confused, sorry.  Are you asking about having the plan pay for medical expenses that are not eligible?  If so, it is determined by the plan administrator.  That is how I understand the question.

[Chaz]

I recently obtained approval under the SCA for an unfunded, self-insured plan (i.e., the typical employer arrangement) for a government contractor client. The whole process took a few weeks. It wasn't tremendously difficult but I recommend reaching out to your benefits counsel to assist you in the process.

[RodeoWrigley]

On 12/17/2019 at 4:19 PM, Chaz said:

I recently obtained approval under the SCA for an unfunded, self-insured plan (i.e., the typical employer arrangement) for a government contractor client. The whole process took a few weeks. It wasn't tremendously difficult but I recommend reaching out to your benefits counsel to assist you in the process.

Thank you. This is essentially our exact situation -- a typical unfunded, self-insured benefits plan.  I usually deal with tax matters, but I was asked to take this on.

I am quite certain that the plan meets all the requirements for approval, but I am uncertain about the process for obtaining such approval.  I reached out to my local branch DOL WHD branch, but have yet to hear back from them.  Can you provide any insight into the process you followed?  Did you have to request a private letter ruling? 

*Edit: I got through to the local branch -- the person I spoke with didn't know the process either and said I would have to call back when someone else was there. 

[Chaz]

I recall that it took us a while to connect with a knowledgeable person at the DOL but were successful when we reached out to the DOL's Wage and Hour Division, Branch of Government Contracts Enforcement in DC. 

The process involved us just submitting an email containing information about the plan (SPDs, etc.) and follow-up email exchanges and did not result in a formal PLR although our client did receive a letter blessing the arrangement.  I recall that there is DOL guidance out there on the items that an applicant is required to submit.  The DOL is most concerned about receiving assurances that the employer has policies in place to make sure the benefits are funded (in the informal sense) and amounts dedicated to paying claims are not diverted. 

There were the typical bureaucratic delays for "approvals" but our examiner was responsive to my client's concerns and the process was not unpleasant.