TMG Reflections

The purpose of our blog is to make you feel included and informed on a more personal level. We want to keep you up-to-date on industry and company news while giving you a glimpse inside The Meltzer Group. Our blog posts may range from helpful tips, to breaking industry news, important information and reminders, random musings, expert opinions, and even some gratuitous employee shout-outs. From time to time we’ll have various employees writing blog posts as a way for you to become familiar with them. We promise to check the industry jargon at the door.

Apr, 17 2014

Wrapping your Health & Welfare Benefits with a Wrap Document


The Employee Retirement Income Security Act (ERISA) is a federal law that sets standards making sure certain information gets disclosed annually to plan participants.  Each health & welfare benefit plan (such as medical, dental, vision, disability, etc.) is required by law to have a written Plan Document kept on file, as well as a Summary Plan Description (SPD) that gets distributed to participants.  In order to gain efficiency and make sure compliance regulations are being followed for all plans, many employers are having a Wrap Document created.  Effectively, the Wrap Document can “wrap” all benefits together under one Plan Document and SPD that satisfies all of the reporting requirements of ERISA.

Who does this apply to?  Are there a minimum number of plan participants?
ERISA applies to virtually all Plan Administrators/Employers who offer or sponsor benefits, regardless of size or number of participants.  The only entities that are exempt from ERISA are government employers and bona fide church groups.

Will a Benefit Booklet or Certificate of Insurance satisfy these requirements?
No.  Insurance companies are not required to create an ERISA-compliant SPD.  While many carriers will provide Certificates and plan information, these typically do not contain the required language or provisions to satisfy ERISA.  This can open the employer up to liability and fines.

Did you just say fines?
New plan SPD’s are required to be distributed within 120 days of the establishment of the plan year.  An updated SPD must be furnished to an employee within 90 days of the update.  Additionally, if an employer fails to provide a copy of the Plan Document or SPD within 30 days of a written request from a plan participant or beneficiary, it can result in fines of $110/day per participant or beneficiary per violation.  Not having a Plan Document or SPD can also trigger an audit by the Department of Labor.

Does this affect Form 5500’s?
Any plans that have more than 100 plan participants on the first day of the plan have to file Form 5500’s.  Each plan should file its own Form 5500, unless a Wrap Document is in place.  With a Wrap Document, one Form 5500 can be filed to include all benefits.  Department of Labor auditors check to make sure Wrap Documents/SPD’s are in place and match Form 5500 filings.

How much does a Wrap Document cost?
Typically, having an ERISA Attorney create a Wrap Document can cost an employer thousands of dollars.  The Meltzer Group partners with several vendors to offer a more affordable solution to these ERISA requirements.

If you would like to find out more about the Wrap Document, or would like The Meltzer Group to coordinate the process of having a Wrap Document created, please contact Aaron Goldberg from our Compliance Department at (301)214-7037 or