Since the enactment of ERISA and the Affordable Care Act (ACA), organizations are faced with implementing – and communicating – more than 80 employee benefit regulations.

Some of the more challenging regulated documents include Summary Plan Descriptions (SPDs), Summaries of Benefits and Coverage (SBCs), Notices of Exchanges and 204(h) materials. Most regulations have been issued with minimum communication standards—addressing content, structure and tone, timing and distribution requirements. And each required document has its own financial, civil and even criminal penalties for non-compliance. That’s a lot to juggle.

Creating benefit documents and materials for employees can be complex, especially when employers must draw from multiple sources for information. Once materials are produced, there’s no guarantee employees will read the information or, perhaps more troubling, understand it.

Our ERISA and ACA compliance team provides comprehensive support through automated benefits plan management, technology-updated regulatory language and templates, full content development, compliance and readability analyses.

Our team combines decades of experience communicating employee benefits with a deep and broad knowledge of employee benefit plans and the corresponding regulations.

Working with DirectPath:

  • Reduces litigation risk
  • Reduces risk of fines, penalties and back benefit awards
  • Dramatically reduces costs and improves efficiencies
  • Improves participant understanding and appropriate use of benefit plans
  • Improves health care consumerism and cost-conscious behaviors

Related Viewing: The Beauty of DirectPath: Being ACA and ERISA Compliant

Case Study

Leading Telecommunications Company Rethinking Possibilities with Help from DirectPath

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  • Communications Strategy
  • Summary of Benefits and Coverage
  • Summary Plan Description
  • Readability Services
  • Legal Notices Brochures
  • Communications Strategy
  • Summary of Benefits and Coverage
  • Summary Plan Description
  • Readability Services
  • Legal Notices Brochures

In this increasingly complex world of employee benefits—with health care literacy at an all-time low and changes to both regulations and plan offerings the norm rather than the exception, benefits communication must be a year-round effort, not just something that happens at open enrollment.

The average individual sees 5,000 ads a day. Add to that the news stories, emails, Twitter postings, IMs and other messaging, and it’s no wonder benefits communications get lost or drowned out. Chances are the first few times you tell your employees something about their benefits, it won’t completely register with them. So how can you ensure your message is getting heard?

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With evolving regulations based on the Affordable Care Act, employers can no longer afford to solve compliance challenges at the document level.

Employers need to be ready. The weeks and months leading up to open enrollment are already stressful, so scrambling to comply with the mandated Summary of Benefits and Coverage (SBC) can make it unbearable.

Failure to comply has the potential to be costly. SBCs must be distributed at initial enrollment (by the first date an individual can enroll in coverage), at open enrollment (no later than 30 days before the beginning of the next plan year), during HIPAA special enrollment (no later than 90 days after enrollment) and on request (no more than seven business days after a request).

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One of the most burdensome tasks is the creation, management and distribution of Summary Plan Descriptions (SPDs).

SPDs are a problem for many employers because they often require a significant amount of time, resources and manual effort—especially if they have not been updated on a regular basis.

Because an SPD is meant to summarize—in language the average plan participant can understand—the provisions of a plan, as well as the rights and responsibilities of both the participant and the employer—the process of updating—or oftentimes creating—an SPD can be daunting. Contracts, certificates and plan documents must be reviewed, steps must be taken to confirm that the plan is actually being administered under the terms of the contract and plan document and as the employer intended—AND that the plan is in compliance with current regulations. Further, attorneys may be consulted to identify any plan provisions that might need clarification—all before content is finalized.

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Summary Plan Descriptions (SPDs) are a critical source of information about an employer’s benefit plans.

Yet a study by EBRI, the Employee Benefit Research Institute, found that important information contained in many SPDs is written at a reading level that may be too difficult for the average plan participant. In fact, the average level of readability for SPDs is higher than the recommended reading level for technical material. More recently, the Government Accounting Office (GAO) reviewed 10 model notices from the agencies (often used by employers in SPDs) against federal plain language guidelines and found that several of the model notices failed to meet those guidelines.

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Each year plan sponsors face a growing list of disclosure requirements for welfare plans.

Some notices are tied to health care reform (such as grandfathered status or the notice of coverage options). Other notices are tied to Title 1 of ERISA. And then there’s Medicare Part D, CHIPRA, WHCRA…and more. Whether a plan is insured or self-insured, it’s the responsibility of the plan sponsor to comply with these disclosure requirements and determine who is providing what notice. For many employers, a stand-alone booklet serves this purpose.

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