VEChannel Event Profile

The Tricky Cafeteria Plan Status Change Rules

Some of the most complicated and perplexing requirements in all of employee benefits are the rules relating to changes in status during the course of a cafeteria plan year. The situation is compounded by the fact that certain conditions will allow participants to change some elections (such as their pretax premium elections), but not others (such as their health Flexible Spending Arrangement). Add to this the fact that the rules have been significantly revised twice in the past few years, and its easy to see why administrators and participants alike scratch their heads when faced with having to make an interpretation of participant options. Yet, with the tax qualified status of the entire plan potentially at risk, plan sponsors and administrators cant afford to make a mistake. Would you know how to respond to a participant who wants to change his or her pretax premium and/or Health Flexible Spending Arrangement election midyear because his or her spouses employers health plan changed from first dollar coverage to an indemnity plan? Similarly, if you add a new medical plan to your benefit program during the cafeteria plan year, can you allow your employees to make new elections for pretax premiums and/or their Health Flexible Spending Arrangement? Would a participant be able to switch from single coverage to family coverage, or vise versa? Are the answers different if the employee is not currently participating in the cafeteria plan? In this presentation, you will learn: The uptodate status change rules that may be used to allow a change in an otherwise "irrevocable" election (caution these rules are not required to be incorporated into plans; webcast participants will be reminded to first review plan documents to determine what rules are permitted by the plan). The specific types of changes that are allowed, and in what circumstances, when the above status change criteria are met. The status change rules that do not apply to a Health Flexible Spending Arrangement (HFSA). The requirements of the "consistency rule" that also must be met in order for a new election to be permitted. The circumstances in which the "significant curtailment" rules for benefit plan cost or coverage changes may allow participants to change their elections during the plan year. How the HIPAA special enrollment rights rules integrate with and affect the cafeteria plan status change rules. The status change rules that apply to dependent care accounts. Please Note: Because of the technical nature of the information being presented in this webcast, it is suggested that persons who have some experience with cafeteria plans will benefit most from this program. If you sponsor a cafeteria plan, or you perform administration services for cafeteria plans, you wont want to miss this opportunity to become an expert on cafeteria plan status changes.

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