What is the Summary Plan Description and COBRA (SPD)
Under ERISA, the summary plan description is the primary vehicle for informing plan participants and beneficiaries about their rights and benefits under the employee benefit plans in which they participate. The Department of Labor (DOL) governs the content of SPD's, including participants' COBRA rights.
Because COBRA provisions confer important substantive rights on participants and beneficiaries, information concerning these rights must be provided in the SPD and not in a separate document.
A plan administrator must distribute the SPD within 90 days of an individual's becoming a plan participant or beneficiary under the plan. COBRA disclosure requirements are satisfied if the covered employee and spouse are provided with the SPD, which includes COBRA continuation coverage information at the time coverage commences under the plan.
When the spouse's last known address is the same as the covered employees, a single mailing of the SPD with COBRA information addressed to both the employee and the spouse constitutes good faith compliance with the COBRA notification requirement. However, in-hand delivery of the SPD to the employee at the work site would not constitute proper notice of COBRA information to the spouse or dependents.
Who enforces ERISA (group health insurance plan) requirements?
Federal courts enforce ERISA requirements. In Sunderlin vs. ENI Technology, the court explained that ERISA requires the plan administrator, upon written request of any participant or beneficiary, to provide a copy of the latest updated SPD. This document must contain accurate and comprehensive information to inform participants and beneficiaries of their rights and obligations under the employer's benefits plan. It must be clearly written so as to be easily understood by the average plan participant.
An SPD must contain the name of the plan, the name and address of the plan administrator, and explain the procedure for addressing denial of claims
To comply with current ERISA requirements for SPD content, the required info must also be written in easily understood language. Providing accurate and easily understood SPDs remains the legal responsibility of the plan administrator.
Employers can be was fined for repeatedly refusing to provide a Summary Plan Description (SPD) to employees and participants especially if the employer acts contrary to the ERISA requirements. If your employer fails to provide a proper Summary Plan Description, send them a demand notice citing Sunderlin vs. ENI Technology. You can also contact the U.S. Department of Labor, who enforces Title I of ERISA.
Craig Casey is an Writer, Coach, Blogger, Husband, and Former Health Insurance Agent helping people on the web since 1999 with their health insurance problems.
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