How Many Form 5500 Do You Have to File?

How Many Form 5500 Do You Have to File?

Is an employer allowed to file a single Form 5500 for their Welfare Benefit Plan which provides multiple benefits under multiple insurance policies/contracts from various insurance carriers? It depends on the facts and circumstances.

If an employer provides the following benefits through the various insurance carriers, how many Forms 5500 would they be required to file? 

  • Self-insurance medical benefit
  • HMO provided by Kaiser
  • PPO provided by Anthem
  • Dental provided by CIGNA
  • Vision provided by VSP
  • Life insurance and AD&D provided by Unum
  • Long-term and short-term disability provided by Reliance

ERISA

Employee Retirement Income Securities Act, (ERISA) generally requires employers to file an annual report on Form 5500 for each welfare benefit plan covering at least 100 participants.  With respect to health and welfare plans, ERISA does not specifically define what constitutes a “plan”.  Rather, ERISA defines the types of benefits that trigger ERISA coverage (e.g., health, life, accident). 

For the first time in the 2005 Form 5500 filing instructions, the DOL discusses the issue of whether the plan sponsor has established one or more plans for Form 5500 reporting purposes.

A plan sponsor can offer benefits through various structures and combinations, such as, a plan sponsor could create (i) one plan providing major medical benefits, dental benefits and vision benefits, (ii) two plans with one providing major medical benefits and the other providing self-insured dental and visions benefits, or (iii) three separate plans.  

The DOL states that you must review the governing documents and actual operations to determine whether welfare benefits are being provided under a single plan or separate plans.

The fact that you have separate insurance policies for each different welfare benefit does not necessarily mean that you have separate plans.  Some plan sponsors use a “wrap” document to incorporate various benefits and insurance policies into one comprehensive plan for Form 5500 reporting.

Welfare Benefit Plans

Welfare benefit plans are required to be evidenced by a written plan document meeting the requirements of §402(b) of ERISA.  In the absence of a legal written plan document, the insurance policy/agreement covering the welfare benefit acts as the plan document or “governing document”.  When a plan sponsor has no plan document that incorporates the various benefits and insurance policies into one single comprehensive plan (a “wrap” document) and provides various benefits through insurance with separate carriers/policies, multiple plans can exist creating multiple Form 5500 filings. 

In the absence of a “wrap” document, assuming all benefits have 100 or more employees enrolled on the first day of the plan year, the above employer would be required to the following Forms 5500:

  • 501 - Health Plan that includes the self-insured medical benefit as well as the HMO and PPO benefits provided by the Kaiser and Anthem contracts
  • 502 - Dental Plan provided by the CIGNA Dental contract
  • 503 - Vision Plan provided by the e VSP contract
  • 504 - Life insurance and AD&D provided by the Unum contract
  • 505 - Long-term and short-term disability provided by the Reliance contract

The self-insured medical, HMO and PPO benefits can be filed together, even though the medical benefits are provided under separate contracts because it is the same benefit, medical.

If Cigna provided both dental and vision benefits, then both benefits could be filed under a single plan. However, if in subsequent plan years, the benefits are provided by separate carriers, then two separate Forms 5500 would be required to be filed.

The same rules would apply if a Unum contract provided life, AD&D as well as long-term and short-term disability. One Form 5500 would be required to include all the benefits provided under the Unum contract.

If an employer has a “wrap” document in place that incorporates the various benefits and insurance policies into one single comprehensive plan, then only one Form 5500 would be required to be filed. 

How Many Forms?

Determining the number of Forms 5500 required to be filed is based on the specific facts and circumstances of the employer, the benefits provided and the insurance carriers providing the benefits.

Amy Boyd, CPA, CEBS

Amy is a Partner with the 5500Tax Group, Inc. She has 25 plus years of experience working with qualified plans as well as welfare benefit plans. Prior to co-founding the 5500Tax Group, she was Senior Manager with the Ernst & Young Human Capital Practice.