A successful employee benefits plan begins with a good provider, a good plan and a well-supported Plan Administrator. The Plan Administrator has an important role to play so that employees have access to the benefits available to them.
The Plan Administrator
The Plan Administrator works for the company that is sponsoring the employee benefits plan. Their job is to act as a liaison between the benefits provider and the employees covered under the plan.
In a medium to large companies, the role of the Plan Administrator is often performed by an individual hired specifically for, and dedicated in, this role. In small businesses, the employer or owner often completes the duties of the plan administrator (along with many other roles!). Sometimes, the Plan Administrator job is shared with another role in the company (often a role in Human Resources). Regardless of how the role is filled in the organization, the Plan Administrator works closely with the employee benefits provider on all aspects of the benefit plan.
Responsibilities of a Plan Administrator
The Plan Administrator has a number of important duties as part of their role.
- Create and manage employee records – An employee record must be created for every employee covered under the benefits plan. The record includes information such as: birthdate, address, spouse and dependents. Often, employee records are created in an electronic database that both the Plan Administrator and the benefits provider can access. When an employee’s information changes, the Plan Administrator is responsible for updating the information in the electronic database.
- Coordinate enrollments and terminations – The Plan Administrator is responsible for enrolling eligible employees in the employee benefits plan. This happens both when the employee benefits plan is initially rolled out, and as new employees join the company. During the initial rollout, the Plan Administrator is responsible for ensuring all the relevant information is collected and added to the database. Sometimes this requires deciphering hand-written enrollment cards, and sometimes this means using an electronic enrollment system to collect the information. The database must be updated when a new employee is hired and becomes eligible for benefits. This information must be updated in the database within 31 days of eligibility in order to join the plan. The Plan Administrator must also update the database when an employee leaves the organization.
- Disseminate benefits information (booklets, changes, other info) – Communicating benefits information to employees is another duty of the Plan Administrator. The most important information to disseminate is specifics on coverage. This is communicated through an employee benefits booklet (either an electronic copy or a paper copy). The Plan Administrator must also communicate information on changes to the plan and coverage.
- Act as in-house expert on benefits – The Plan Administrator is the main contact for employees covered under the benefits plan. If an employee needs clarification on benefits or coverage, the Plan Administrator should be able to answer many questions. If a claim is denied, the plan member should first talk to the Plan Administrator at their company before contacting the benefits provider. The Plan Administrator will also be able to provide claim forms or access to electronic claim forms.
- Manage waiver of premium – There are some situations where the insurer may waive the premiums for an employee covered under a group benefits plan. The Plan Administrator can apply for a “waiver of premium” when certain criteria are met (for example: when an employee is on leave due to long-term disability). The Plan Administrator is responsible for applying for and managing ‘waiver of premium’ situations. Insurance companies have strict timelines for applying for ‘waiver of premium,’ so the Plan Administrator must be diligent in managing them.
- Review and pay billing statements – The Plan Administrator must review monthly billing statements to ensure they are accurate, as well as coordinate payment of the statements. If there are any issues with the billing statement, the Plan Administrator works with the benefits provider to correct any problems.
- Store documentation – Documentation is an important part of any insurance arrangement, and employee benefits are no different. The Plan Administrator is responsible for storing paper or electronic enrollments, beneficiary information and other documentation related to the coverage.
The Plan Administrator makes an impact
The job of the Plan Administrator comes with significant responsibility and there are legal implications if the Plan Administrator doesn’t uphold those responsibilities. Consider life insurance and beneficiary information. If this information is not accurate in the system, it could result in a legal action.
More importantly, the Plan Administrator makes an impact in the day-to-day benefits experience. The Plan Administrator is often the “face” of employee benefits at the organization and is the first contact for common employee benefits questions and issues. How they respond sets the tone for how employees interact with their benefits and their benefits plan.
Making the Plan Administrator’s Job Easier
The job of a Plan Administrator is an important one, so it makes sense to try to make it as easy as possible. There are a couple of ways to make the job easier and less time-intensive. The first and most important variable is software and systems. An easy-to-use benefits administration platform is a must. A good system includes triggers and alarms to automate common day-to-day duties of a Plan Administrator. Electronic enrollment in the plan goes hand-in-hand with this. Electronic enrollment eliminates the need for the Plan Administrator to manually enter employee information in the system. It also prompts employees for missing information so the Plan Administrator doesn’t have to follow up with employees for missing information.
Having good communication and support from the employee benefits provider (or insurer) is also a must. Good communication, along with training and support from the provider help make the Plan Administrator’s job easier. Making the job easier means the Plan Administrator will have more time to focus on other tasks.
Good Advice is Key
Does your Plan Administrator have all the support they need? Do you need more information on the role of a Plan Administrator? Explore your options with one of our licensed advisors on the phone, or contact us for a comparison quote.
Whether you’re looking for extended health and dental coverage, disability coverage, or life and critical illness coverage, GroupHEALTH has affordable benefits packages that work as hard as you do.