When asked questions on the Schedule As, most know just enough to be dangerous. After reading our Top 14 Rules and Facts on Schedule As, you will know what we here at Wrangle know. Also be sure to read the sidebar found at the end highlighting the option to upload Schedule As on your own in our Dashboard.
The Top 14 Rules and Facts on Schedule As
1. They are required for a fully insured benefit (premium-based) provided by an insurance company/service. Self-funded benefits do not get reported on a Schedule As even if commissions were paid to a broker. (They may still require a Form 5500 report though.)
- If an insurance company does not provide the Schedule A, the Plan Sponsor can have a placeholder within the Form 5500/Sch. A report. The Placeholder will include a note to the DOL specifying that the carrier failed to provide the Schedule A. (Noted in #11 and #12 on the Form 5500 Schedule A.) The Plan Sponsor is not penalized for the missing information.
2. Per ERISA, carriers are to issue Schedule As by 120 days after the end of the year. Note that some carriers will only release the Schedule A to the Plan Sponsor.
3. If the Form 5500 report is required to be filed—however, one or more of the policies have less than 100 enrolled covered persons—a Schedule A is still required to be included if there is a Wrap Document in place bundling all benefits under a single ERISA Plan.
4. Schedule A data is based on the last day of the policy period. As a result, they are not the best source to know if a Form 5500 should be filed. The reporting threshold is based on the enrolled employee + ex-employee/COBRA count at the beginning of the ERISA Plan Year. If the Plan is under a Trust or MEWA, the reporting threshold does not apply.
5. Schedule As—particularly for the health benefits—include the subscriber plus the dependent counts, while Schedule As for Life, Long Term Disability, and AD&D type insurance benefits typically report the subscriber only.
6. The Schedule A must be reported on the true policy period, unless the carrier does not track the policy on the renewal policy period but rather the anniversary or Plan year.
7. The Schedule A cannot be for more than 12 months. If a policy period is 14 months, 2 Schedule As should be generated: one for 12 months and the second one for 2 months.
8. The total premium listed may appear to be wrong on the Schedule A to a Plan Sponsor. It may fall short of what the Plan Sponsor’s records dictate. There is a logical reason for this. The carrier will only report premiums recorded during the actual policy period. For example, a Plan Sponsor paid the December bill in January, for a calendar year policy period. When the underwriter tabulates the total premiums it will not include the January payment since it was not recorded in December.
9. If any of the data listed on the Schedule A looks incorrect and the Plan Sponsor changes the data listed in the Form 5500 report, the carrier is no longer liable for the information. The best approach is to work with the carrier to see about providing a revised Schedule A if an error was made.
10. The policy ending date must fall within the ERISA Plan Year to be reported in that Form 5500. However, the Schedule A may start prior to the ERISA Plan Year to report the policy period as shown in the example found below:
- Example:
- ERISA Plan Year: Jan. 1, 2018 – Dec. 31, 2018
- Business Travel Accident (BTA) Policy Period: April 1 – March 30
- What is the Policy period for the 2018 Form 5500?
- Correct Answer: April 1, 2017 – March 30, 2018
- Incorrect Answer: April 1, 2018 – March 30, 2019
11. A Schedule A for a Stop Loss policy is required for a Trust ERISA Plan only. It would not be required for a plan that is unfunded, or where premiums are paid via General assets or insurance premiums.
12. If the policy includes commissions or fees paid to the Broker, the Broker’s name and address are required to be listed on the Schedule A.
13. Schedule As are used for EAP and wellness policies even if the policy is issued by a vendor and not an insurance carrier. Many vendors balk at the idea of submitting a Schedule A. If the benefit is ERISA reportable and the vendor refuses, a place holder Schedule A will be included with the note that the vendor declined to submit. This does not jeopardize the Plan Sponsor but rather keeps the vendor responsible.
14. Not all Schedule As include commissions. The broker may have a consulting fee arrangement instead with the Plan Sponsor. In this case, the fees paid by the Plan Sponsor directly to the broker will not be reported on the Schedule A.
Dashboard Reminder: Schedule As may be uploaded directly into the Dashboard. Key aspects to keep in mind: Â
- Only one Schedule A should be uploaded per policy line or number.
- If you have a bundled set of pages for multiple Schedule As within one PDF, best practice is to email those to Wrangle directly. We will then separate the Schedule As to where they need to be.
- If the wrong Schedule A was uploaded, you can just send us a quick email. We can remove it from the Dashboard for you.
- Please be sure to upload the Schedule A that matches the policy number and policy period.
Please send an email request to Ann McAdam if you need the cheat sheet to learn how to upload Schedule As to the Dashboard. You will be just amazed at how easy and quick it is: amcadam@wrangle5500.com.