ERISA Compliance: Maintaining the Plan’s Benefits Claims Procedure
ERISA Compliance: Fiduciary Responsibilities
Under ERISA, group health plans must establish and maintain reasonable claims procedures that allow participants and beneficiaries to apply for and receive the plan’s promised benefits. Fiduciaries must maintain the plan’s procedures. DOL regulations provide minimum standards for benefit claims determinations for ERISA plans (including insured and self-funded plans). While many plans hire benefits professionals or insurance companies to process claims, it is important for an employer to understand the requirements before selecting a service provider who can comply with the standards.
A claim for benefits is a request for a plan benefit made in accordance with the plan’s procedures by a claimant (participant or beneficiary) or a claimant’s authorized representative. Questions concerning plan benefits, coverage and eligibility questions, and casual inquiries are generally not considered claims for benefits.
The key issues to become familiar with are the timeframes for deciding claims, the contents for the notices of benefit denials and the standards for appeals of benefit denials. More information on the benefit claims procedures for group health plans is available on the DOL’s webpage for health plan compliance assistance.
The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that sets minimum standards for employee benefit plans maintained by private-sector employers. ERISA includes requirements for both retirement plans (for example, 401(k) plans) and welfare benefit plans (for example, group health plans). ERISA has been amended many times over the years, expanding the protections available to welfare benefit plan participants and beneficiaries.
ERISA includes standards of conduct for those who manage an employee benefit plan and its assets, who are called “fiduciaries.” This Legislative Brief includes a set of frequently asked questions (FAQs) to help employers understand the basic fiduciary responsibilities applicable to group health plans under ERISA.