BASE^® Blog

Employers that offer an employee health benefit plan, such as health insurance, Health Reimbursement Arrangements (HRAs), 125 Cafeteria Plans, to name a few, are subject to the provisions of ERISA. 

The Employee Retirement Income Security Act (ERISA) is a federal law that sets the minimum standards for health and welfare benefit plans to provide the protection for the participants in the employer-sponsored plans.  ERISA regulates plan administrators and sponsors of the health benefits to ensure they provide plan information to their participants and their dependents, and the offered benefits are outlined. 

The BASE® ERISA Wrap is a risk management tool that is designed to help employers provide the required provisions and information necessary to comply with the ERISA requirements and wrap around the existing certificates of insurance and benefit plan booklets with the Summary Plan Description (SPD) and Plan Document.  The ERISA Wrap applies to virtually all employers who sponsor a health benefits plan, regardless of size, structure, or number of participants. 

Violations of ERISA happen when a party has certain obligations imposed under the law and fail to live up to those obligations.  Three of the most common ERISA violations are:

1. Improper denying benefits to current/former employees
2. Breach of fiduciary duty toward those employees covered by the plan
3. Interference with the rights of the employees covered by the plan

For those that commit ERISA violations, there are two ways to bring forward an investigation.  The first of these is if someone who is covered by the plan, files a complaint against the violator.  The second is through an action that was initiated by the Employee Benefits Security Administration, EBSA, which is a part of the DOL that enforces the laws related to ERISA. 

Under ERISA, there are two types of penalties for these violations.  The first is civil penalties such as fines, being required to change procedures or practices, or to make a payment to the plan participant.  Civil penalties are assessed on a case-by-case basis with the penalty amounts depending on the degree of willfulness in which the violations were committed. 

The second is criminal punishments, which the party may need to pay a fine and be found convicted of violating an ERISA requirement and may be imprisoned.  Criminal punishments can depend on the nature of the violation and the corresponding provision with the federal law.  For example, backdating paperwork relating to the plan, altering to make it appear that a transaction happened before it did, can result in severe penalties. 

The ERISA Wrap helps to protect the interests of the employee benefit plan participants, including their beneficiaries, and ensures they receive their appropriate benefits with access to the information about their health benefit plan. 

Employers may have questions about their obligations under ERISA and BASE® is here to help!  For more information contact BASE® at 888.386.9680 or visit www.BASEonline.com. 

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For an employer, being able to provide employees with a means to pay for their health insurance premiums on a pre-tax basis, a means to pay for their qualified out-of-pocket health care expenses, and a means to pay for their dependent care expenses is pretty sweet, but, what if BASE® could help sweeten the deal even more?

Let us introduce you to the Lifestyle Spending Account!  This wellness benefit is the perfect complement to the more traditional health benefits such as the Flexible Spending Account (FSA), Health Savings Account (HSA), and other 125 Cafeteria Plans.  The employer allots a certain amount of money towards those expenses that are wellness related, and so the name:  lifestyle. 

The Lifestyle Spending Account (LSA) allows employers to customize a post-tax spending account to help their employees pay for eligible products and services that promote healthy habits and the overall well-being of their employees. 

The BASE® LSA is available to all businesses who want to help their employees pay for eligible expenses that promote physical, financial, and emotional well-being that are not covered by insurance.

Eligible expenses for the LSA include, but are not limited to:

PHYSICAL:  Athletic and exercise equipment, gym, health club, spa and fitness studio memberships, fitness classes and lessons, personal trainers, fitness trackers, entry fees to marathons and passes to ski and golf, and nutritional supplements. 

FINANCIAL:  Home purchase expense reimbursement, financial advisor and planning services, financial seminars and classes, and identity theft services. 

EMOTIONAL/OTHER:  Non-medical counseling services, retreats such as leadership or spiritual, camping supplies, meditation, and personal development classes such as art and cooking, annual park passes, and hunting and fishing licenses. 

The BASE® Lifestyle Spending Account (LSA) helps employers offer an innovative wellness benefit that helps to attract and retain talent, also showing employees their employer cares about their physical health and mental well-being.  This incentive encourages healthy behaviors that will help reduce insurance costs. 

When the employer sweetens the deal by adding in the LSA with other employer-sponsored health benefits, the employer gives their employees the opportunity to better their physical and mental health today, which benefits the company in all the “tomorrows.”  Employers will have happy, healthy, and more productive employees with a plan that won’t break the bank. 

Contact BASE® at 888.386.9680 or visit www.BASEonline.com for more information on how to sweeten the deal with the Lifestyle Spending Account (LSA).

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