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Checklist for Plan Administrators

Updated: Mar 8, 2022

‘Tis the Season of Lists, and boy do we have one for you! This year, 4C is giving every ERISA health plan administrator the gift of comfort and confidence in knowing that they are doing their part to protect their plan, employees, and plan sponsor!

4C has created a comprehensive checklist for plan administrators to guide them towards compliance with new obligations pursuant to ERISA and Department of Labor Regulations. Self-funded health plan administrators have, in many ways, been on the front lines of the COVID pandemic and all of the tumult in the healthcare industry over the last several years. They can expected to be, at any given time, counselors, advocates, event managers, vaccine planners, return to work experts… the list goes on.

With the promulgation of new rules and regulations applicable to ERISA plans, they are now being asked to undertake a whole new level of oversight, financial control management, and accountability and face severe consequences if they are unwilling (or more likely unable) to fully fulfill these fiduciary obligations.

We hope that you find this checklist useful as both a guide and guidepost in effectively and efficiently running your self-funded health plan. This will also help you mitigate risk of liability in the future. Click here for a downloadable and printable .PDF version of this checklist.

In the spirit of the Season of Gratitude and Giving, thank you for your service throughout these challenging times and we hope that this checklist is a gift that keeps on giving.

Checklist for Data Access and Ownership (ERISA)

▢ Request and Review all Administrative Services Agreements (ASA).

▢ Ensure that ASA provides that Plan with non-conflicted and unbiased access to cost and quality of care information, including specific claims data (amend ASA if not in compliance).

▢ Mandate required format* in which all specific claims data shall be delivered to Plan.

*Uniform format should include robust data fields that will disclose all costs of plan, including claims, value based payments, capitated fees, subcontractor fees, etc.

▢ Prepare and file annual certification of compliance confirming that the claims data will not be publicly disclosed outside of the Plan.

Checklist for Fee Disclosure Processes (DOL, ERISA and IRC)

▢ Confirm all service providers whose fees must be disclosed pursuant to Rule 408(b)(2):

• Pharmacy Benefit Manager

• Point Solution Vendor

• Third Party Administrator

• Transparency Tool Vendor • Consultant/Broker

• Disease Management Vendor

▢ For each service provider, confirm that a Fee Disclosure has been made available annually by each such service provider, which shall include:

• Description of the services to be provided

• Statement of the entity’s fiduciary status’

• Detailed description of “compensation” received by the CSP for services, including direct and indirect compensation (very broadly defined)

▢ Ensure that Fee Disclosures are on file in advance of the date the contract is “entered into, extended or renewed”.

▢ Maintain a process to ensure that Fee Disclosures are Updated or Re-Certified Annually.

▢ Engage in a Reasonableness Evaluation of all Fees (Direct and Indirect) on an Annual Basis and document all findings in a consistent and comprehensive way.

▢ Notice all service providers that they have an affirmative duty to provide any updates to Fee Disclosures on or within 60 days of notice (no materiality threshold).

▢ Engage in Routine (no less than annual) Audit of all Fee Disclosure Processes.

Safe Harbor for Plan Fiduciaries

A responsible plan fiduciary will not be deemed to have engaged in a prohibited transaction if (1) they reasonably, but mistakenly, believed that the Fee Disclosure had been made and (2) subsequently took the following steps to remedy the breach:

▢ Request in writing that the covered service provider furnish the Fee Disclosures and engage in the steps as outlined in the “Checklist for Fee Disclosure Processes (DOL, ERISA, and IRC)”.

▢ If the covered service provider refuses or fails to furnish the Fee Disclosures as set forth above within 90 days of the request, notification to Department of Labor of failure.

▢ If contract is already ongoing, Plan fiduciary must perform a meaningful evaluation of whether to terminate the contract, consistent with duty of prudence (*Note that without Fee Disclosure, burden of proof will fall on Plan Fiduciary will be difficult because they will be unable to engage in a reasonableness analysis without the information required in the Fee Disclosure.

▢ If contract relates to future services and Fee Disclosures are not provided consistent with first bullet above, then contract must be terminated expeditiously.

Visit our Resource Center for a downloadable and printable .PDF version of this checklist and to access other available resources.


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