What a bright time, it’s the right time…for benefit planning

Many people are making a list and checking it twice, for very different reasons than the holiday season. Instead of shopping for two turtle doves and a partridge in a pear tree, this season is about ensuring that benefit plans are ready for 2007. Here are some helpful reminders from Infinisource:

Open Enrollment. Applies to Each COBRA Qualified Beneficiary (QB) is entitled to the same options and benefits as similarly situated active employees, including notifications, rate changes and the ability to switch to another plan, if applicable. If an outside administrator (i.e.., Infinisource) provides COBRA premium billing for QBs, remember to notify the administrator of new plans, changes in rates and changes that QBs have made during open enrollment.

Grace Periods. These are available for Health and/or Dependent Care Flexible Spending Accounts (FSAs). Employers calendar-year plans who are adopting grace periods for the first time must amend plan documents before the end of 2006. Employers adopting a Dependent Care FSA grace period may continue to report the amount of 2006 deductions in Box 10 of the W-2, which generally must be distributed by January 31, 2007.

Plan Changes. Any changes to ERISA plans will require notifications to affected participants in the form of a Summary of Material Modifications or an updated Summary Plan Description.

Health Savings Accounts (HSAs)/High-Deductible Health Plans (HDHPs). For 2007, the HSA annual contribution maximums will increase for individual ($2,700 to $2,850) and family ($5,450 to $5,650) coverage. For HSA-compatible HDHPs, the annual out-of-pocket spending limits will increase for individual ($5,250 to $5,500) and family ($10,500 to $11,000) coverage. The HDHP minimum deductibles will also change for individual ($1,050 to $1,100) and family ($2,100 to $2,200) coverage.

Mileage Rates. The 2007 mileage rate for reimbursable medical expenses in Health FSAs and HRAs is $.20 per mile.

Transportation Plans. In 2007,monthly transportation benefits for parking will be $215. The combined limit for transit passes and vanpooling will be $110.

Nondiscrimination Testing. For Health and Dependent Care FSAs and HRAs, there will be new dollar limitations for Key Employees ($140,000 to $145,000). The limitation for Highly Compensated Employees will remain at $100,000.

Thus, benefit professionals need not cry, nor pout but should instead watch out to make sure everything is ready for a bright and prosperous 2007.
Clients with Infinisource may contact a Customer Response Representative at 866-320-3040 for assistance with providing plans and rates.

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