ERISA Delivery Requirements for Summary Plan Documents

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Lumity, Inc.

Administrators of employee benefits plans that are subject to the Employee Retirement Income Security Act of 1974 (ERISA) are required to provide a summary plan description (SPD) to plan participants and beneficiaries.

Below are the general distribution timing rules, as outlined by the U.S. Department of Labor, Employee Benefits Security Administration (EBSA) in the Reporting and Disclosure Guide for Employee Benefits Plans (pdf).

General SPD Distribution Timing

New Plans

  • New Plans: Within 120 days of the plan’s creation date
  • New Participants: Within 90 days of the participant becoming covered under the plan (unless the plan is new, then within 120 days of the plan’s creation date)

Existing Plans / Participants

  • An updated SPD must be furnished every 5 years if changes are made to the SPD information or a plan is amended (see “Summary of Material Modification” section)
  • Otherwise, an SPD must be furnished every 10 years
  • See 29 CFR § 2520.104b-2 - Summary Plan Description

General SMM Distribution Timing

A Summary of Material Modification (SMM) is required whenever there is a material change to the plan. Note that there are different rules that apply if there is a reduction in health benefits.

  • Material Reduction in Covered Services for health plans only: within 60 days after adoption of the change
    • Best practice is to distribute the SMM in advance of the reduction if possible
  • All Other Material Changes: Within 210 days after the end of the plan year
  • See 29 CFR § 2520.104b-3 - Summary of Material Modifications

NOTE: There is no need to distribute an SMM if the changes are incorporated into an updated SPD that is distributed within the applicable SMM timeframe.

General SBC Distribution Timing

Whenever there is a mid-year material modification that affects the content of the Summary of Benefits and Coverage (SBC), employers will need to distribute an updated SBC or a summary of the changes.

Unlike the SMM distribution rule, the updated SBC must be distributed 60 days prior to the date the change will become effective. This is the case whether the change is a reduction or an improvement in benefits.

Electronic Notification

It’s okay to post an SPD or other ERISA disclosure to your company intranet, online benefits portal, wiki, etc. Just make sure you also send a notice to employees each time new ERISA documents are posted online. See 29 CFR §2520.104b-1(c) - Disclosure through electronic media.

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