Is a two-year election period valid under a cafeteria plan?

[rocknrolls2]

Company X provides a cafeteria plan to its employees. Employees are permitted to elect annually the coverages they will receive during the following year. However, with respect to dental coverage, an employee's election remains in effect for two plan years, in the absence of a change in status. Is a two-year lockout a violation of the cafeteria plan rules? If so, on what basis?

[Lisa Hand]

Does it specifically state the dental premium is a two year election?

[rocknrolls2]

Yes.

[Lisa Hand]

How does the plan document define the Plan Year?

[rocknrolls2]

Calendar Year - Plan requires participation in same level of coverage for same dependents for 2 calendar years absent a change in status.