“I Call The Plan Fiduciary To The Stand!”
Whether they like it or not plan sponsors must now understand they are in the health insurance business……
What employers need to know:
The CAA expands ERISA Section 408(b)(2) to cover health and welfare benefits plans (specifically employer-sponsored medical, dental, and vision plans) and clearly identifies the plan sponsor (employer) as a fiduciary on the plan.
It requires the plan sponsor to:
- Ensure all gag clauses have been removed from plan contracts
- Collect compensation disclosures from all brokers/consultants servicing the plan
- Determine if the compensation earned by those vendors is “reasonable”
- Submit annual attestations to the DOL to that effect
- Prepare for detailed reporting on prescription drug usage and coverage equality for mental health vs. medical conditions.
What should employers do?
- Step 1: Acknowledge that you must now administer your health and welfare benefits plans as a fiduciary.
- Step 2: Establish a fiduciary process to review your current plan, evaluate its performance, and document your decision-making process
- Step 3: Identify all plan vendors, and collect compensation disclosures from all Covered Service Providers (as defined by the CAA)
- Step 4: Benchmark those vendors against others in the area to determine if their compensation is “reasonable”
- Step 5: Determine which vendor will complete the prescription drug reporting on your behalf (carrier, TPA, PBM, external 3rd party?)
- Step 6: Determine which vendor will complete the analysis to demonstrate coverage equality for mental health vs. medical conditions.
Getting into compliance with the CAA will be a big lift. It will require taking a hard look at your current benefits plan, reevaluating decisions that were made years ago, collaborating with your service providers, and seeking advice from unbiased experts.
.https://401kspecialistmag.com/why-a-tidal-wave-of-fiduciary-lawsuits-are-coming-soon/
