On any given day, we may be asked:
“The employer has historically filed multiple welfare benefits under a single plan number and one Form 5500; however, a corresponding Wrap Plan Document cannot be located. Can the employer continue filing as one plan?”
Questions like this often create concern because historical practice does not necessarily determine the correct approach moving forward. Just because something has been done a certain way in the past does not automatically mean it complies with current requirements. Or does it?
As with many ERISA compliance questions, there may be more than one perspective to consider. In this article, we outline several viewpoints and factors that may influence the decision. Ultimately, the determination rests with the Plan Sponsor, ideally in consultation with legal counsel.
The 2025 Form 5500 Instructions state (page 19):
“You must review the governing documents and actual operations to determine whether welfare benefits are being provided under a single plan or separate plans.”
In the absence of a Wrap Plan Document, the Department of Labor (DOL) may look at the underlying insurance contracts and other governing documents to determine whether multiple benefits constitute a single ERISA plan or separate plans. If the benefits are not formally bundled under a single plan document, the DOL could take the position that each benefit and/or carrier contract represents its own plan, requiring separate reporting.
Under that interpretation, previously filed Form 5500s may need to be amended to separately report each benefit as its own plan.
However, the Form 5500 Instructions also reference the plan’s “actual operations.” This suggests that factors beyond written plan documents may be relevant, such as:
- How the plan communicates b to participants.
- How the benefits are administered.
- Whether the employer treats the benefits as part of a single welfare program.
- How reporting and compliance activities have historically been handled.
This approach is consistent with the way some courts have analyzed similar issues.
Court Considerations
Court guidance on welfare benefit plan bundling is limited. However, those that have generally evaluate multiple factors rather than relying exclusively on the existence of a Wrap Plan Document.
For example, in Loren v. Blue Cross & Blue Shield of Michigan (6th Cir. 2007), the court considered a variety of facts when determining whether benefits constituted a single ERISA plan. Factors included:
- How the insurance contracts were negotiated.
- Whether a single plan number was assigned.
- Whether a single Form 5500 was filed.
- The overall administration and operation of the benefit program.
This demonstrates that courts may take a broader view and look at both documentation and operational practices when evaluating plan structure.
Department of Labor Perspective
To gain additional insight, we consulted two DOL representatives and received conflicting answers when this scenario was posed. Because the answers differ, there is no one-size-fits-all solution, and each situation should be reviewed based on its specific factors. The most conservative approach is to rely on the DOL’s written instructions.
In Closing
Our guidance generally follows a conservative compliance approach that adheres to the letter of the law. From that perspective, we recommend maintaining a properly executed Wrap Plan Document to support the filing of a single Form 5500 for multiple welfare benefits.
To our knowledge, ERISA does not formally recognize a “historical precedent” exception that permits an employer to continue a filing practice solely because it has been done that way in the past. As a result, during a DOL audit, the agency could still take the position that prior Form 5500 filings should be amended if a Wrap Plan Document was not in place to support the bundling of benefits.
Ultimately, the decision rests with the Plan Sponsor and their willingness to defend the chosen filing position. Accordingly, we recommend discussing the matter with legal counsel or a qualified ERISA attorney before determining the appropriate course of action.
If you have questions regarding Wrap Plan Documents, Summary Plan Descriptions (SPDs), or document preparation services, please contact the ERISA Desk team at ERISADeskInfo@ascensus.com.