Five Ways to Survive a Department of Labor (“DOL”) Health and Welfare Plan Investigation

Allison B. Bans • May 24, 2016

DOL health and welfare plan investigations are on the rise. There are best practices for plans chosen for investigation:

 1.  Get Employee Benefits Counsel Involved Early.

The DOL investigation process generally starts with a letter from DOL requesting a long list of documents that range from plan documents and disclosures to financial documents (e.g., trust agreements and bank statements). This letter can be overwhelming, not only because of the sheer quantity of documents that must be produced in a relatively short time period, but also because many of the requests may be broad, vague, or even inapplicable to your plan.

Working with employee benefits counsel from the beginning may help you respond.  For example, even the most diligent employers may forget to provide a mandatory disclosure from time to time.  In those circumstances, knowledgeable counsel may help correct or mitigate such failures and/or craft an appropriate response to DOL.

2.  Confirm the Scope of the Document Request.

DOL may, in its initial letter or follow-up correspondence, request extensive information, for example, a year’s worth of claims data for all participants in the plan. In such instances, you may want to ask whether DOL would be satisfied with a smaller, random sampling.

This is particularly important if the requested data includes protected health information (“PHI”) under HIPAA. While a plan administrator may generally disclose PHI to DOL for oversight activities (including investigations of health and welfare plans) without obtaining authorization from such participants, a plan administrator must limit the disclosure to the “minimum necessary.” In doing so, the plan administrator may reasonably rely on a representation from DOL that the requested information was the minimum necessary for its purpose.

3.  Stay Organized and Document your Disclosures.

Although you must respond to DOL’s letter and subsequent requests in a relatively short time frame, the overall investigation process often takes months, or even years, to complete. Likewise, there may be long stretches of time when you are not contacted by the investigator.  You may find it helpful to prepare a log that records the documents requested, the documents produced, and any notes or comments you may have.  This way you can easily keep track of where you are in the process.  

 4.  Prepare Your Employees for Interviews.

Often DOL will request to interview certain employees and that can be intimidating for them. They may feel that there are negative consequences if they do not know, or incorrectly answer, the investigator’s questions.   This fear may be compounded if the investigator asks the employee a series of questions that he or she reasonably should not or would not know.  Like a deposition, you may find it helpful to prepare your employees, so that they know what to expect and some general best practices (e.g., to answer questions truthfully and if you do not know the answers to DOL’s questions do not guess).

You may also consider having counsel present throughout the interviews. Some ways counsel may help are: (1) to keep a running list of any additional document requests; (2) when necessary, request that the investigator rephrase or clarify a question; and (3) generally observe the tone and direction of the investigation (e.g., whether the investigator is focusing on a particular issue).

5.  Carefully Review Findings and Closing Letters.

As the investigation winds down, DOL will issue a “findings letter” that explains any violations that DOL has identified. If you disagree, it is important to respond.  Once you agree to the terms in the letter, DOL may refer your case to other Agencies for further investigations or to assess penalties.

Once violations are corrected (or if no violations are found), DOL will issue a “closing letter.” You may wish to review this letter carefully.  If you have corrected a violation discovered by DOL, you may wish to obtain an acknowledgment from DOL that the violation has been properly corrected.

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By Mardy Gould • May 24, 2024
Employee burnout has become an epidemic in today’s modern workplace. So much so that the World Health Organization (WHO) officially recognizes it as an “occupational phenomenon.”1 While many used to consider mounting workplace stress an individual employee problem, these days, it’s become an employer’s responsibility to prevent burnout before it hurts productivity and business performance—not to mention your employees’ physical and mental health. Luckily, you can prevent burnout from affecting your workforce in several ways. This article will explore the causes and signs of employee burnout and the steps you can take to create a positive work environment where employees feel safe from toxic stress levels.

Form 720 and PCORI fee FAQs

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If you're a small business owner, you may have heard of the acronym PCORI and the fees that come with it. But what is PCORI, and how does it apply to your organization? Under the Affordable Care Act (ACA), sponsors of self-insured health plans must pay a fee to fund the federal Patient-Centered Outcomes Research Institute (PCORI). PCORI is an independent organization the ACA created to conduct research to help healthcare consumers make better decisions for their specific needs and outcomes. It also performs research related to clinical effectiveness. Employers offering a self-insured medical reimbursement health plan, such as a health reimbursement arrangement (HRA), must pay this fee by July 31 each year via Form 7201. This fee was initially set to expire in 2019, but Congress extended it through September 30, 20292, due to the Further Consolidated Appropriations Act of 20203.
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