ERISA


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Employee Retirement Income Security Act (ERISA)

The law that regulates the operation of private pensions and benefit plans.

Employee Retirement Income Security Act of 1974

Legislation in the United States, passed in 1974, that established a number of regulations to ensure that employers and other involved parties do not misuse the funds entrusted to them in retirement accounts. Among other provisions, the Act requires retirement account managers to provide information to account holders on a regular basis. It also sets standards for managers' use of discretionary authority and allows account holders to sue their pensions for unpaid benefits.

ERISA

Employee Retirement Income Security Act (ERISA).

This comprehensive law, best known by the acronym ERISA, governs qualified retirement plans, including most private-company defined benefit and defined contribution plans, and protects the rights of the employees who participate in the plans.

ERISA also established individual retirement arrangements (IRAs), made it easier for self-employed people to set up retirement plans, and made employee stock ownership plans part of the tax code.

Among ERISA requirements are that plan participants receive a detailed document that explains how their plan operates, what employee rights are -- including qualifying to participate and uniform vesting schedules -- and what the grievance and appeals process is.

In addition, ERISA assigns fiduciary responsibility to those who sponsor, manage, and control plan assets. This means they must act in the best interests of the plan participants. ERISA rules do not apply to plans provided by federal, state, or local governments, church plans, or certain other plans.

ERISA has been amended several times since it was passed in 1974, making some provisions more flexible and others more restrictive. Among the changes were the Consolidated Omnibus Budget Reconciliation Act (COBRA), which provides continuing access to coverage, for a fee, when an employee leaves an employer who offers health insurance, and the Health Insurance Portability and Accountability Act (HIPAA), which protects access to health insurance coverage for employees and their families with pre-existing medical conditions when the employee leaves a job that provided coverage and moves to a new job where coverage is also offered.

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to avoid ERISA preemption, while still holding PBMs accountable for
information on ERISA and the evolution of state reporting requirements
ERISA Section 105(1)(B)(i) requires the administrator of a defined benefit plan, other than a one-participant plan, to furnish a pension benefit statement every three years to each employee participant who has a nonforfeitable accrued benefit.
What types of defined benefit pension plans are not subject to Title IV of ERISA and, therefore, would be exempt from providing the annual funding notice?
The hospitals argued that pension plans do not have to be established by a church for the ERISA exemption to apply because the plans are maintained by qualifying church-affiliated organizations.
Courts of appeals for the Third, Seventh, and Ninth circuits agreed with the employees, concluding that ERISA's "plain text" requires that a pension plan be established by a church to qualify for the church-plan exemption.
Liberty Mutual: Supreme Court justices question Vermont's self-insured plan data call PPACA: Michigan Implements Rate Review Regs Supreme Court backs self-insured plans in ERISA case
For example, ERISA plans may seek to settle denial of benefits claims earlier in the litigation process.
ERISA plans may also become less likely to settle marginal claims out of concern that even a nuisance value settlement may open the doors to a fee award.
In the context of ERISA, a plan fiduciary must act as a "prudent 401 (k) expert," making informed decisions in the best interest of all affected employees.
ERISA acknowledges that it's not reasonable to expect a business owner to possess the professional knowledge necessary to make every 401(k)-related decision.
cases in which the courts denied the plaintiff-employees' ERISA