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1. Understanding Liability

Most private-sector employers that sponsor health plans are ERISA Fiduciaries and ERISA Plan Administrators. This means they have bottom-line responsibility for complying with the federal laws that regulate their plans. While third-party administrators and insurers may help with these responsibilities, employers retain the liability for ensuring such compliance tasks are done and done correctly.

All too often, employers’ real-world perception of liability and responsibility does not match their actual legal obligations. Therefore, employers must have documented processes in place to fulfill their own obligations and monitor the compliance activities performed by other parties on their behalf.