QUESTION: Our company is establishing a new health plan. How do we determine what plan number to assign to it?
ANSWER: The number for your new plan will depend on whether your company maintains or has previously maintained another welfare plan. A plan number is a three-digit number that the plan sponsor assigns to differentiate a plan from other plans that it sponsors. The assigned plan number, together with the plan sponsor’s 9-digit employer identification number (EIN), creates a unique 12-digit number that identifies the plan for government agencies and must be included on the annual Form 5500. As explained in the instructions for Form 5500, a plan sponsor’s health and other welfare plans should be numbered consecutively starting with 501. Pension plans, including 401(k) plans, should be numbered consecutively starting with 001. For example, if your company establishes a health plan and a life insurance plan (two welfare plans) and one 401(k) plan and has not previously sponsored any other welfare or pension plans, the welfare plans would be numbered “501” and “502,” and the 401(k) plan would be numbered “001.”
Once a plan number is assigned, it should always be used in connection with that plan and should not be used for any other plan. Thus, when a plan is terminated, its plan number should be retired. A new plan should be assigned the next available number that has not previously been used. For example, if your company previously sponsored a welfare plan that was numbered “501” and that plan was later terminated, you would assign a new welfare plan the number “502.” Note that making changes to a plan—including, for example, changing insurance carriers for an insured health plan—typically is not a plan termination that would result in a new plan (or a new plan number).
The plan number is also used for other plan disclosure and reporting purposes. It must appear in an ERISA plan’s SPD as one of the plan’s identifying items, and on certain types of correspondence with government agencies regarding the plan. Although not required, plan sponsors often include the plan number in the plan’s summary annual report (SAR). For a discussion regarding how to determine the number of plans an employer has for purposes of ERISA, see our Checkpoint Question of the Week.
For more information, see EBIA’s ERISA Compliance manual at Sections XI.A (“Specifying How Many Welfare Benefit Plans Are Maintained”), XXII.H (“Completing Form 5500 Main Body”), and XXIV.J.1 (“Plan-Identifying Information”). See also EBIA’s 401(k) Plans manual at Section XXXI.E.2 (“Information Required by Form 5500 Main Body”).
Contributing Editors: EBIA Staff.