Preparing for and AVOIDING a DOL Audit

August 16, 2016 by in category Rules & Regulations with 0 and 0

Rules & RegulationsBecause a DOL audit can disrupt an employer’s day-to-day business operations and possibly result in penalties (or other corrective action), it is important for employers to know how to prepare for, and potentially avoid, a DOL audit of their health plan.

As a general rule, the best way to prepare for a DOL audit of your health plan is to confirm that your plan complies with all applicable federal laws, such as HIPAA and ACA. It is also important to have documents showing your compliance and to maintain these documents so they are easy to access in the event of a DOL audit. If an employer takes steps before being selected for audit, it can reduce its exposure to penalties. It can also make the audit process more manageable and less time-consuming.

It is also important for an employer to understand why the DOL selects certain health plans for audit and take steps to minimize that audit risk.

Audit Triggers

A DOL audit can be triggered for a variety of reasons. In most cases, the DOL investigator will not disclose to an employer why its health plan was selected for audit. However, there are some common audit triggers that an employer should keep in mind.

Common triggers for a DOL audit include:

  • Participant complaints to the DOL about potential ERISA violations. According to a DOL audit summary, 775 new investigations were opened as a result of participant complaints.
  • Answers on the plan’s Form 5500. For example, if a plans Form 5500 is incomplete, or if inconsistent information is reported from year to year, the DOL may investigate the issue further.
  • The DOL’s national enforcement priorities or projects, which target the DOL’s resources on certain issues. For example, the DOL’s Health Benefits Project focuses on making health plans and health insurance issuers comply with the ACA’s mandates.

Are you compliant with all federal benefits laws, rules and regulations?

There are countless rules and regulations governing employee benefit plans, many of which are complex. At Integrated Benefits Group, our resources will help you meet your compliance obligations and keep you up-to-date on laws and regulations that affect your employee benefits programs.

Integrated Benefits Group (IBG) is an independent insurance brokerage firm located in Stoneham, MA. To contact us, call 781-438-0098.

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