Item C13 BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
Meeting Date: December 10, 2014 Division: Employee Services
Bulk Item: Yes ® No ❑ Department:
Staff Contact Person: Teresa Aguiar, Division Director Phone: 292-4458
AGENDA ITEM WORDING: Approval of resolution adopting amendment to Section 125 Plan
Document and Adoption Agreement. The Plan Document is required by IRS Code section 125 and sets
forth the details by which employees can have the cost of premiums for health insurance, dental and
vision benefits deducted from their paychecks on a pre-tax basis.
ITEM BACKGROUND: IRS code section 125 (26 U.S.C. § 125) allows employees to have the cost
of premiums for certain benefits from a cafeteria plan, including the cost of health insurance for the
employee and their dependents, to be deducted from gross wages, thus reducing the employee's tax
liability and eliminating the obligation of the County to pay employment taxes on that portion of
income. The details of the employer's plan must be set forth in a written document. Monroe County's
Section 125 plan document has not been updated in a number of years.
PREVIOUS RELEVANT BOCC ACTION:
Approval of prior Section 125 plan in 1993.
CONTRACT/AGREEMENT CHANGES: N/A
STAFF RECOMMENDATIONS: Approval
TOTAL COST: $ 0 INDIRECT COST: $ BUDGETED: Yes ❑ No ❑
DIFFERENTIAL OF LOCAL PREFERENCE:
COST TO COUNTY: $ SOURCE OF FUNDS: $
REVENUE PRODUCING: Yes ❑ No ® AMOUNT PER MONTH Year
APPROVED BY: County Attorney: ❑ OMB/Purchasing: ❑ Risk Management: ❑
DOCUMENTATION: Included: ❑ Not Required: ❑
DISPOSITION: AGENDA ITEM#:
Revised 7/09
RESOLUTION NO. -2014
A RESOLUTION BY THE MONROE COUNTY BOARD OF COUNTY
COMMISSIONERS ADOPTING AN AMENDED SECTION 125 PLAN
DOCUMENT AND ADOPTION AGREEMENT
WHEREAS, Section 125 of the Internal Revenue Code C Code'),26 U.S.C. § 125,allows
an employer to adopt a written cafeteria plan ("Section 125 Plan!), pursuant to which eligible
employees who elect to participate in the Plan ('Tarticipants") may choose among 2 or more
optional benefits and may elect to pay the premiums for those optional benefit coverages in pre-
tax dollars, thereby saving both employees and Monroe County the cost of various payroll taxes;
and
WHEREAS,Monroe County wishes to continue its Section 125 Plan for the benefit of the
County's eligible employees; and
WHEREAS,it is necessary to update the Monroe County Section 125 Plan in order to
address changes in the Internal Revenue Code,the Affordable Care Act,and other federal statutes;
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY
COMMIISSIONERS OF MONROE COUNTY,FLORIDA,as follows:
Section 1. Monroe County Board of County Commissioners hereby adopts the Section
125 Cafeteria Plan Document and Adoption Agreement, both of which shall be effective as of the
date specified in the Adoption Agreement.
Section . The County Administrator or his designee is authorized to execute future
amendments to the Cafeteria Plan Document and to the Adoption Agreement that contain only
changes mandated by federal or state law, or non-substantive and administrative changes.
PASSED AND ADOPTED by the Board of County Commissioners of Monroe County,
Florida this day of December 2014.
Mayor Danny IColhage
Mayor Pro Tem Heather Carruthers
Commissioner David Rice
Commissioner George Neugent
Commissioner Sylvia Murphy
BOARD OF COUNTY COMMISSIONERS
OF MONROE COUNTY,FLORIDA
BY
Mayor
(SEAL)
ATTEST:
AMY HEAVILM,CLERK MONVE COUNTY ATTORNEY
A ROV OLAS T O
e L.D YNT IA L
Deputy Clerk ASSISTANT COUNTY ATTORNEY
1 Date - 3-0 1
MONROE COUNTY BOARD OF COUNTY COMMISSIONERS
AMENDED AND RESTATED
CAFETERIA PLAN DOCUMENT
Table of Contents
ARTICLE1 INTRODUCTION.....................................................................................................3
Section1.01 PLAN....................................................................... 3
Section 1.02 APPLICATION OF PLAN..................................................................................3
ARTICLE 2 DEFINITIONS......................................................................................
ARTICLE3 PARTICIPATION...................................................................................................5
Section3.01 PARTICIPATION................................................................................................ 5
Section3.02 TRANSFERS.......................................................................................................5
Section 3.03 CESSATION OF PARTICIPATION,REINSTATEMENT...............................6
Section 3.04 PROCEDURES FOR ADMISSION....................................................................6
ARTICLE 4 CONTRIBUTIONS TO THE PLAN.......................................................................6
Section 4.01 PAYROLL REDUCTION.................................................................. 6
Section 4.02 ELECTIONS....................................................
Section 4.03 REVOCATION OF ELECTIONS....................................................................... 8
ARTICLE 5 LIMITATIONS ON CONTRIBUTIONS............................................................. 11
Section 5.01 NONDISCRIMINATION.................................................. 11
ARTICLE 6 PLAN ADMINISTRATION............................................................................. 11
Section 6.01 PLAN ADMINISTRATOR............................................................................... 11
Section 6.02 HIPAA PRIVACY RULES ............................................. .................... 13
Section 6.03 MEDICAL CHILD SUPPORT ORDERS......................................................... 15
ARTICLE 7 AMENDMENT AND TERMINATION............................................................. 15
Section7.01 AMENDMENT.................................................................................................. 15
Section7.02 TERMINATION................................................................ .............. 16
ARTICLE 8 MISCELLANEOUS ............................................................................................. 16
Section 8.01 NONALIENATION OF BENEFITS............................. .. 16
..................................
Section 8.02 NO RIGHT TO EMPLOYMENT.................................... .. 16
Section 8.03 NO FUNDING REQUIRED................................... ...... 16
Section 8.04 GOVERNING LAW........................................................................
Section 8.05 TAX EFFECT.......................................................
Section 8.06 SEVERABILITY OF PROVISIONS ..................................... .. 17
Section 8.07 HEADINGS AND CAPTIONS......................................................................... 17
Section 8.08 GENDER AND NUMBER......................... .................... 17
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ARTICLE 1 INTRODUCTION
Section 1.01 PLAN
This document("Cafeteria Plan Document") and its related Adoption Agreement are
intended to qualify as a cafeteria plan within the meaning of section 125 of the Internal Revenue
Code("Code")of 1986,as amended, and is to be interpreted in a manner consistent with the
requirements of Section 125. To the extent provided in the Adoption Agreement,the Plan
provides for the pre-tax payment of insurance premiums that is excludable from gross income
under Code section 125.
Section 1.02 APPLICATION OF PLAN
Except as otherwise specifically provided herein,the provisions of this Plan shall apply to
those individuals who are Eligible Employees of Monroe County Board of County
Commissioners,hereinafter referred to as"the County,"on or after the Effective Date.
ARTICLE 2 DEFINITIONS
"Account" means the balance of a hypothetical account established for each Participant as
of the applicable date. "Account"or"Accounts" shall include to the extent provided in the
Adoption Agreement, a Premium Conversion Account, and such other account(s) or sub-
account(s) as the Plan Administrator,in its discretion,deems appropriate.
"Adoption Agreement"means the document executed in conjunction with this Basic Plan
Document that contains the optional features selected by the Plan Sponsor.
"Annual Enrollment"means the period immediately preceding the beginning of each
Plan Year established by the Administrator, such period to be applied on a uniform and
nondiscriminatory basis for all Employees and Participants. However, an Employee's initial
enrollment period shall be determined pursuant to Section 5.L
"Cafeteria Plan"means this document, including any amendments to it.
"Code" means the Internal Revenue Code of 1986,as amended from time to time.
"Coon it means the Plan Sponsor and any other entity that has adopted the Plan with the
approval of the Plan Sponsor.
"Compensation" means the cash wages or salary paid to a Participant by the Employer
during a Plan Year.
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"Do end means any individual who qualifies as a dependent under an Insurance
Contract or under IRS Code Section 152 (as modified by Code Section 105(b)).
"Effective Date" shall have the meaning set forth in the Adoption Agreement.
"Eligible Employee"means any Employee employed by the County, subject to the
modifications and exclusions described in the Adoption Agreement. If an individual is
subsequently reclassified as,or determined to be, an Employee by a court, the Internal Revenue
Service or any other governmental agency or authority, or if the County is required to reclassify
such individual an Employee as a result of such reclassification determination(including any
reclassification by the County in settlement of any claim or action relating to such individual's
employment status), such individual shall not become an Eligible Employee retroactively by
reason of such reclassification or determination but will be eligible to participate in the Plan
prospectively.
"Employee"means any individual who is employed by the Employer. The term
"Employee" shall not include: (i)a self-employed individual as defined in IRS Code section
401(c), (ii) substitute,temporary,and emergency temporary employees,as defined in the Monroe
County Personnel Policies and Procedures Manual ("Manual"), (iii) part-time employees
working less than 25 hours per week, (iv) contract employees,unless the benefit is specified
within their contract, and(v) employees less than 18 years of age.
"Employ"means the County or any other employer required to be aggregated with the
County under Code sections 414(b), (c), (m) or(o); provided,however,that "Employer"shall not
include any entity or unincorporated trade or business prior to the date on which such entity,
trade or business satisfies the affiliation or control tests described above.
"ERISA"means the Employee Retirement Income Security Act of 1974, as amended
from time to time.
time. "FMLA"means the Family and Medical Leave Act of 1993 as amended from time to
"Insurance Contract"means an insurance policy, contract or self-funded arrangement
under which a Participant is eligible to receive benefits regardless of whether such policy,
contract or arrangement is related to any benefit offered hereunder. Insurance Contract shall not
include any product which is advertised,marketed, or offered as long-term care insurance.
"Optional Benefit Coverages"means the medical care coverage options available to a
Participant as set forth in the Adoption Agreement.
"Participant"means an Eligible Employee who participates in the Plan in accordance
with Articles 3 and 4.
4
"Plan"means the cafeteria plan set forth in this Plan document and the Adoption
Agreement, the name of which is designated in the Adoption Agreement,together with any
exhibits or amendments thereto. The terms of this Plan document shall be interpreted in
accordance with the elections made by the Employer in the Adoption Agreement.
"Elan Administrator"means the person(s)designated by the Employer pursuant to the
Adoption Agreement and Section 6.01 to supervise the administration of the Plan, consistent
with this Plan document.
"Plan Sponsor"means the entity described in the Adoption Agreement.
"Plan Year"means the 12-consecutive month period described in the Adoption
Agreement.
"Premium Conversion Account"means the Account established with respect to the
Participant's election to have insurance premiums reimbursed by the Plan pursuant to Section
4.01 of this Plan.
"Spouse"has the same meaning as defined in the Insurance Contract or means a legally
married husband or wife of a Participant(under controlling federal or state law).
"Termination" and"Termination of Emplovment to mean any absence from service that
ends the employment of the Employee with the County.
ARTICLE 3 PARTICIPATION
Section 3.01 PARTICIPATION
Each Eligible Employee will become a Participant in this Plan on the date he or she
becomes an Eligible Employee subject to completion of a 60 day waiting period and who elects
to participate in the Plan. Participation in the Plan only means that the Participant is entitled to
contribute toward his or her share of the cost of Optional Benefit Coverages on a pre-tax basis.
The date that participation in this Plan commences does not necessarily correspond with the
starting date or effective date of any Optional Benefit Coverage elected by the Participant. A
Participant shall be eligible to make elections only for such Accounts as are specifically
authorized in the Adoption Agreement.
Section 3.02 TRANSFERS
If a change in job classification or a transfer results in an individual no longer qualifying
as an Eligible Employee, such Employee shall cease to be a Participant for purposes of Article 4
5
(or shall not become eligible to become a Participant)as of the effective date of such change of
job classification or transfer, unless otherwise provided in the Adoption Agreement. Should
such Employee again qualify as an Eligible Employee,he shall become a Participant as of the
first day of the subsequent Plan Year, unless earlier participation is required by applicable law or
permitted pursuant to the change of status provisions of Section 4.02(a). If an Employee who
was not previously an Eligible Employee becomes an Eligible Employee,he shall become a
Participant on the first entry date following the later of the effective date of such subsequent
change of status or the date the Employee meets the eligibility requirements of this Article 3.
Section 3.03 CESSATION OF PARTICIPATION REINSTATEMENT
(a) A Participant shall cease to be a Participant as of the earlier of(i)the date on
which the Plan terminates, (iii)the date on which a valid revocation of election under Section
4.02 occurs,or(iii)the date on which the Participant ceases to be an Eligible Employee.
(b) A former Participant who meets the requirements for an Eligible Employee will
become a participant again if and when he or she becomes an Eligible Employee, subject to
completion of any applicable waiting period.
Section 3.04 PROCEDURES FOR ADMISSION
The Plan Administrator shall prescribe such forms and may require such data from
Participants as are reasonably required to enroll a Participant in the Plan or to effectuate any
Participant elections made pursuant to Article 4.
ARTICLE 4 CONTRIBUTIONS TO THE PLAN
Section 4.01 PAYROLL REDUCTION
(a) Premium Conversion Account. Your compensation will be reduced by the
amount necessary to pay your medical, dental and/or vision insurance benefit premiums. Benefits
under the Cafeteria Plan shall be financed by Payroll Reductions sufficient to pay your premium
expenses for your benefits. By signing the election of benefits, each Participant will agree to
reduce your compensation by the amount necessary to pay for the benefits under the Plan. The
amounts so withdrawn shall be placed in a Premium Conversion Account. The amount of the
contributions to the account shall not exceed the employee-paid portion of the premiums payable
under the Insurance Contracts specified in the Adoption Agreement. If an Insurance Contract is
offered in conjunction with a County-sponsored benefit plan, the Participant shall be eligible to
make contributions to the Premium Conversion Account only if he or she is eligible to participate
in the applicable County-sponsored Plan. The Account established under this section is intended
to qualify under Code Section 79. Elections for Code section 79 coverage shall be made on an
6
i
after-tax basis to the extent that the premiums relate to coverage in excess of the limit described in
Section 79(a).
(b) Any payroll reduction shall be determined prior to the beginning of the Plan Year
(subject to any elections in Section 4.02)and prior to the end of the Annual Enrollment, and will
be irrevocable for the Plan Year except as allowed by Section 4.02,below.
(c) As soon as possible after each payroll period, the County shall credit the Payroll
Reduction to the Premium Conversion Account for the purpose of paying Premium Expenses.
The Plan Administrator will not direct the County to pay any premium on an Insurance Contract
in excess of the balance of the Participant's Conversion Account.
(c) Conflicts. In the event of a conflict between the terms of this Plan and the terms
of an Insurance Contract, the terms of the Insurance Contract(or the benefit plan under which it
is established) shall control in defining the terms and conditions of coverage including,but not
limited to, the persons eligible for insurance, the dates of their eligibility,the conditions which
must be satisfied to become insured,if any, the benefits Participants are entitled to and the
circumstances under which insurance terminates.
Section 4.02 ELECTIONS
the eligibility requirements in Section 3.01 m�t°to al Election). Any Participant who meets
a) Election Procedure New Enrollees I
Y participate in the Cafeteria Plan,
provided the Participant does so within 30 calendar days of the date of eligibility. Any election
during this 30-day election period shall not be effective until the first pay period after the later of
the effective date of participation or receipt of the election form by the County, and shall be
limited to Benefit expenses for the remainder of the Plan Year for which the election is made.
(b) Election Procedure Existing_Employees. Prior to commencement of each Plan
Year,the Plan Administrator shall provide(or make available)and shall specify a means of
election for each existing Participant and for other individuals who are expected to or who may
become Participants during the upcoming Plan Year. The election shall be effective as of the
beginning of the next Plan Year. Each Participant who desires to elect Optional Benefit
Coverage during the Plan Year shall specify so in his or her election. The Participant shall agree
to a reduction in his or her compensation equal to the cost of the Optional Benefit Coverage
premiums elected by the Participant. Each election must be on or before the date specified by
the Plan Administrator.
(c) Failure to Make Elections.
(1) New participants. A new Participant's failure to make an election under
Section 4.06 on or before the due date specified by the Plan Administrator for the Plan Year in
which he or she becomes a Participant shall constitute an election by the Participant to receive
his or her full compensation in cash,and to pay the premiums for the Optional Benefit Coverage
in after-tax dollars.
7
(2) Existing cipants. An Existing Participant's failure to make an
election relating to the payment of premiums for Optional Benefit Coverage on or before the due
date specified by the Plan Administrator for a subsequent Plan Year shall constitute(a) a re-
election of the same coverage, if any, as was in effect just prior to the end of the preceding Plan
Year(to the extent such Optional Benefit Coverage remains available under the Plan), and(b)an
agreement to a reduction in the Participant's compensation for the subsequent Plan Year equal to
the cost of the coverage.
(c) If elected in the Adoption Agreement, a Participant's election for benefits
described in Section 4.01 shall be automatically adjusted for any change in the cost of insurance
pursuant to the terms of Treas.Reg. 1.125-4.
(d) Leave of Absence/FMLA/USERRA. The Plan Administrator shall permit a
Participant taking unpaid leave, including but not limited to leave under the FMLA or USERRA,
to continue medical benefits under such applicable law unless otherwise specified in the
Adoption Agreement. Participants continuing participation pursuant to the foregoing sentence
shall pay for such coverage(on a pre-tax or after-tax basis)under any method as determined by
the Plan Administrator satisfying Treas. Reg. 1.125-3 Q&A-3 (pre-pay,pay as you go, or catch-
up). Any Participant on FMLA leave who revoked coverage shall be reinstated to the extent
required by Treas. Reg. 1.125-3. If the Participant's coverage under the Plan terminates while the
Participant is on FMLA leave, the Participant is not entitled to receive reimbursements for claims
incurred during the period when the coverage is terminated. Upon reinstatement into the Plan
upon return from FMLA leave,the Participant has the right to (i)resume coverage at the level in
effect before the FMLA leave and make up the unpaid premium payments, or(ii)resume
coverage at a level that is reduced by the amount of unpaid premiums and resume premium
payments at the level in effect before the FMLA leave. The Plan Administrator shall also permit
Participants to continue benefit elections as required under the Uniformed Services Employment
and Reemployment Rights Act and shall provide such reinstatement rights as required by such
law. The Plan Administrator shall also permit Participants to continue benefit elections as
required under any other applicable state law to the extent that such law is not pre-empted by
federal law.
(e) COBRA. The Plan is subject to COBRA(Code section 4980B and other
applicable state law). Therefore, a Participant shall be entitled to continuation coverage with
respect to his or her Account as prescribed in Code Section 4980B (and the regulations
thereunder) or such applicable state statutes.
(f) Procedures. A Participant shall make the elections described in this Section in
such form and manner as may be prescribed by the Plan Administrator and at such time in
advance as the Plan Administrator may require.
Section 4.03 REVOCATION OF ELECTIONS
(a) By Participant. Any election made under this Article 4 shall be irrevocable by the
Participant during the Plan Year unless revocation is required by the provisions of the Federal
Family and Medical Leave Act or other applicable law and is permitted under Treas.Reg. 1.125-
8
4 and the provisions of the Adoption Agreement. Elections may be modified upon the
occurrence of any of the following events:
(1) HIPAA Special Enrollment Rights.Participant may revoke an election for
coverage under a group health plan during a period of coverage and make a new election that
corresponds with the special enrollment rights provided in Code section 9801(f).
(2) Change in Status. A Participant may revoke an election during a period of
coverage with respect to a qualified benefits plan(as defined in Treas. Reg. 1.125-4(i)(8))and
make a new election for the remaining portion of the period if,under the facts and
circumstances: (i) a change in status described in Subsections (A)-(F) occurs; and(ii) the
election change is on account of and corresponds with a change in status that affects eligibility
for coverage under a qualified benefits plan.
(A) Legal Marital Status. Events that change a Participant's legal
marital status, including the following: marriage; death of spouse; divorce; legal separation; and
annulment.
(B) Number of Dependents. Events that change a Participant's number
of dependents, including the following: birth; death; adoption; and placement for adoption.
(C) Employment Status. Any of the following events that change the
employment status of the Participant, the Participant's spouse, or the Participant's dependent: a
termination or commencement of employment; a strike or lockout; a commencement of or return
from an unpaid leave of absence; a change in worksite and,the extent permitted in Treas. Reg.
1.125-4 and Section 3.03 in this Plan, change in employment status resulting in gaining or losing
eligibility under the Plan.
(D) Dependent Satisfies or Ceases to Satisfy Eligibility Requirements.
Events that cause a.Participant's dependent to satisfy or cease to satisfy eligibility requirements
for coverage on account of attainment of age, student status, or any similar circumstance.
spouse, or dependent. (E) Residence. A change in the place of residence of the Participant,
(F) Significant Curtailment with Loss in Coverage. If the Participant
experiences a significant curtailment with loss of coverage,the Participant may revoke his or her
election under the Plan for the remainder of the plan year. For purposes of this paragraph, term
"loss of coverage"means:
(i) loss of coverage by reason of reaching an overall lifetime or
annual limitation under the terms of the policy;
(ii) a substantial decrease in the number of health care providers
available under the plan offered by the carrier(e.g., such as a major hospital within a 25-mile
radius ceasing to be a member of the preferred provider network or a decrease of 25%or more in
the number of providers participating in a preferred provider network within a 25-mile
geographic radius);
9
(iii) a reduction in benefits for a specific type of condition or
treatment with respect to which the employee is currently being treated.
(3) Judgment,Decree, or Order. A Participant may modify an election
pursuant to a judgment, decree,or order resulting from a divorce,legal separation,annulment, or
change in legal custody(including a qualified medical child support order as defined in ERISA
section 609)that requires accident or health coverage for a Participant's child or for a foster child
who is a dependent of the Participant;provided that the modification:
(A) changes the Participant's election to provide coverage for the child
if the order requires coverage for the child under the Plan; or
(B) cancels coverage for the child if the order requires the spouse,
former spouse, or other individual to provide coverage for the child; and that coverage is,in fact,
provided.
(4) Entitlement to Medicare or Medicaid. A Participant may modify an
election for benefits attributable to a County-sponsored accident or health plan if the Participant,
spouse,or dependent becomes entitled to coverage under Medicare or Medicaid(other than
coverage consisting solely of benefits under the program for distribution of pediatric vaccines).
The Participant may make a prospective election change to cancel or reduce coverage of that
Participant, spouse, or dependent under the accident or health plan. Corresponding rights to
commence or increase benefits under the accident or health plan shall be granted in the case of
loss of coverage under Medicare or Medicaid.
(5) Significant Cost or Coverage Changes. A Participant may modify an
election for benefits, other than those provided in Section 4.02,as a result of changes in cost or
coverage pursuant to Treas. Reg. section 1.125-4.
(6) FMLA. A Participant taking leave under the FMLA may revoke an
existing election of accident or health plan coverage and make such other election for the
remaining portion of the period of coverage as may be provided for under the FMLA.
(7) Any other event permitted by the Code or its Regulations, as amended
from time to time.
(a) By Plan Administrator. If the Plan Administrator determines that the Plan may
fail to satisfy any nondiscrimination requirement or any limitation imposed by the Code,the Plan
Administrator may modify any election in order to assure compliance with such requirements or
limitations. Any act taken by the Plan Administrator under this Subsection shall be carried out in
a uniform and non-discriminatory manner.
(b) Automatic Termination of Election. Any election made under this Section shall
automatically terminate on the date specified in Sections 3.02 or 3.03 of this Plan.
10
(c) Plan Administrator Discretion. The Plan Administrator reserves the right to
determine whether a Participant has experienced an event that would permit an election change
under this Section and whether the Participant's requested election change is consistent with
such event.
ARTICLE 5 LBUTATIONS ON CONTRIBUTIONS
Section 5.01 NONDISCRIMINATION
(a) Cafeteria Plan. The Plann may not discriminate in favor of highly compensated
employees(within the meaning of Code section 125(e))as to benefits provided or eligibility to
participate.
(b) Group Term Life. The Plan may not discriminate in favor of key employees
(within the meaning of Code section 416(i)(1)) as to benefits provided or eligibility to participate
with respect to any group term life insurance offered pursuant to Section 4.01.
ARTICLE 6 PLAN ADiVIINISTRATION
Section 6.01 PLAN ADMINISTRATOR
(a) Designation. The County is the Cafeteria Plan's Administrator.
(b) Authority and Responsibility of the Plan Administrator. The Plan Administrator
shall have total and complete discretionary power and authority:
(i) to make factual determinations,to construe and interpret the provisions of
the Plan,to correct defects and resolve ambiguities and inconsistencies therein and to supply
omissions thereto. Any construction,interpretation or application of the Plan by the Plan
Administrator shall be final, conclusive and binding;
(ii) to determine the amount, form or timing of benefits payable hereunder and
the recipient thereof and to resolve any claim for benefits in accordance with Article 6;
(iii) to determine the amount and manner of any allocations hereunder;
(iv) to maintain and preserve records relating to the Plan;
I I.
(v) to prepare and furnish all information and notices required under
applicable law or the provisions of this Plan;
(vi) to prepare and file or publish with the Secretary of Labor,the Secretary of
the Treasury, their delegates and all other appropriate government officials all reports and other
information required under law to be so filed or published;
(vii) subject to approval of the Monroe County Board of County
Commissioners,to hire such professional consultants as it,in its sole discretion, deems necessary
or advisable. The Plan Administrator shall be entitled, to the extent permitted by law,to rely
conclusively on all tables, valuations, certificates, opinions and reports which are furnished by
same;
(viii) to determine all questions of the eligibility of Employees and of the status
of rights of Participants;
(ix) to adjust Accounts in order to correct errors or omissions;
(x) to determine the validity of any judicial order;
(xi) to retain records on elections and waivers by Participants;
(xii) to supply such information to any person as may be required; and
(xiii) to perform such other functions and duties as are set forth in the Plan that
are not specifically given to any other fiduciary or other person.
(c) Procedures. The Plan Administrator may adopt such rules and procedures as it
deems necessary, desirable, or appropriate for the administration of the Plan. When making a
determination or calculation,the Plan Administrator shall be entitled to rely upon information
furnished to it. The Plan Administrator's decisions shall be binding and conclusive as to all
parties.
(d) Allocation of Duties and Responsibilities. The Plan Administrator may designate
one or more other persons to carry out any of the duties and responsibilities under the Plan.
(e) Compensation. The Plan Administrator shall perform the above-listed duties and
responsibilities within the compensation for his or her existing job.
(f) Expenses. All direct expenses of the Plan,the Plan Administrator and any other
person in furtherance of their duties hereunder shall be paid or reimbursed by the County.
(g) Allocation of Fiduciary Duties. A Plan fiduciary shall have only those specific
powers, duties,responsibilities and obligations as are explicitly given under the Plan. It is
intended that each fiduciary shall not be responsible for any act or failure to act of another
fiduciary. A fiduciary may serve in more than one fiduciary capacity with respect to the Plan.
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Section 6.02 HIPAA PRIVACY RULES
(a) Application. This Section shall only apply in the event that this Plan constitutes a
group health plan as defined in section 2791(a)(2) of the Public Health Service Act or if the
Adoption Agreement provides that the Plan is subject to the HIPAA privacy rules.
(b) Privacy Policy. The Plan shall adopt a HIPAA privacy policy, the terms of which
are incorporated herein by reference.
(c) Business Associate Agreement. The Plan will enter into a business associate
agreement with any persons as may be required by applicable law as determined by the Plan
Administrator.
(d) Notice of Privacy Practices. The Plan will provide each Participant with a notice
of privacy practices to the extent required by applicable law.
(e) Disclosure to the County's designated privacy officer.
(1) In General. This Subsection permits the Plan to disclose protected health
information("PHI"), as defined in the HIPAA privacy rules,to the County to the extent that such
PHI is necessary for the County to carry out its administrative functions related to the Plan.
(2) Permitted Disclosure. The Plan may disclose the PHI to the County that is
necessary for the County to carry out the following administrative functions related to the Plan:
eligibility determinations, enrollment and disenrollment activities, and Plan amendments or
termination. The County may use and disclose the PHI provided to it from the Plan only for the
administrative purposes described in this Subsection.
(3) Limitations. The County agrees to the following limitations and
requirements related to its use and disclosure of PHI received from the Plan:
(A) Use and Further Disclosure. The County shall not use or further
disclose PHI other than as permitted or required by the Plan document or as required by all
applicable law,including but not limited to the HIPAA privacy rules. When using or disclosing
PHI or when requesting PHI from the Plan,the County shall make reasonable efforts to limit the
PHI to the minimum amount necessary to accomplish the intended purpose of the use,disclosure
or request.
(B) Agents and Subcontractors. The County shall require any agents,
including subcontractors, to whom it provides PHI received from the Plan to agree to the same
restrictions and conditions that apply to the County with respect to such information.
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(C) Employment-Related Actions. Except as permitted by the HIPAA
privacy rules and other applicable federal and state privacy laws,the County shall not use PHI
for employment-related actions and decisions,or in connection with any other employee benefit
plan of the County.
(D) Reporting of Improper Use or Disclosure. The County shall
promptly report to the Plan any improper use or disclosure of PHI of which it becomes aware.
(E) Adequate Protection. The County shall provide adequate
protection of PHI and separation between the Plan and the County by: (i) ensuring that only
those employees who work in the benefits department of the County on issues related to the
healthcare components of the Plan will have access to the PHI provided by the Plan; (ii)
restricting access to and use of PHI to only the employees identified in clause(i) above and only
for the administrative functions performed by the County on behalf of the Plan that are described
herein; (iii) requiring any agents of the Plan who receive PHI to abide by the Plan's privacy
rules; and(iv)using the County's established disciplinary procedures to resolve issues of
noncompliance by the employees identified in clause(i) above.
(F) Return or Destruction of PHI. If feasible, the County shall return
or destroy all PHI received from the Plan that the County maintains in any form,and retain no
copies of such information when no longer needed for the purpose for which disclosure was
made. If such return or destruction is not feasible, the County shall limit further uses and
disclosures to those purposes that make the return or destruction of the information infeasible.
(G) Participant Rights. The County shall provide Participants with the
following rights: (i) the right to access to their PHI in accordance with 45 C.F.R. §164.524; (ii)
the right to amend their PHI upon request(or the County will explain to the Participant in writing
why the requested amendment was denied) and incorporate any such amendment into a
Participant's PHI in accordance with 45 C.F.R. §164.526; and(iii)the right to an accounting of
all disclosures of their PHI in accordance with 45 C.F.R. §164.528.
(H) Cooperation with federal Health&Human Services(HHS). The
County shall make its books,records, and internal practices relating to the use and disclosure of
PHI received from the Plan available to HHS for verification of the Plan's compliance with the
HIPAA privacy rules.
(4) Certification. By executing the accompanying Adoption Agreement, the
County hereby certifies that the Plan documents comply with 45 C.F.R. §164.504(f), and that the
County protects the PHI as described in Subsection 3 herein.
(5) Security Standards Requirement. To comply with the Security Standards
regulations that were published on February 21, 2003, the County must:
(A) implement administrative,physical and technical safeguards that
reasonably and appropriately protect the confidentiality,integrity and availability of the
electronic PHI that it creates,receives,maintains or transmits on behalf of the Plan;
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(B) ensure that the adequate separation required by 45 C.F.R.
164.504(f)(2)(iii)is supported by reasonable and appropriate security measures;
(C) ensure that any agent,including a subcontractor,to whom it
provides this information agrees to implement reasonable and appropriate security measures to
protect the information; and
(D) report to the Plan any security incident of which it becomes aware.
(6) Amendment. Notwithstanding any other provision of the Plan, this
Section may be amended in any way and at any time by the Privacy Officer.
(7) Effective Dates. Subsections(1)—(4)and Subsection(6) apply to the
Plan no later than April 14, 2003, or such other date that the FUPAA Privacy Regulations apply
to the Plan. Section(5) applies to the Plan no later than April 20,2005, or such other date that
the HIPAA Security Regulations apply to the Plan.
Section 6.03 MEDICAL CHILD SUPPORT ORDERS
In the event the Plan Administrator receives a medical child support order(within the
meaning of ERISA section 609(a)(2)(B)), the Plan Administrator shall notify the affected
Participant and any alternate recipient identified in the order(a) that the County has received the
order, and(b)the Plan's procedures for determining whether such an order is a qualified medical
child support order(within the meaning of ERISA section 609(a)(2)(A)). Within a reasonable
period the Plan Administrator shall determine whether the order is a qualified medical child
support order and shall notify the Participant and alternate recipient of such determination.
ARTICLE 7 AMENDMENT AND TERAHNATION
Section 7.01 AMENDMENT
The provisions of this Plan may be amended in writing at any time and from time to time
by the Plan Sponsor. Such amendment shall be in the form of a written instrument signed by the
Mayor of Monroe County Board of County Commissioners, or the Mayor's duly authorized
representative, and delivered to the Plan Administrator.
The Adoption Agreement may be amended without the need to execute a new Adoption
Agreement.
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Section 7.02 TERMINATION
(a) It is the intention of the Plan Sponsor that this Plan will be permanent. However,
the Plan Sponsor reserves the right to terminate the Plan at any time for any reason.
(b) Each entity constituting the County reserves the right to terminate its participation
in this Plan.
ARTICLE 8 MISCELLANEOUS
Section 8.01 NONALIENATION OF BENEFITS
No Participant or Beneficiary shall have the right to alienate, anticipate, commute,
pledge, encumber or assign any of the benefits or payments which he may expect to receive,
contingently or otherwise,under the Plan.
Section 8.02 NO RIGHT TO EMPLOYMENT
Nothing contained in this Plan shall be construed as a contract of employment between
the County and the Participant, or as a right of any Employee to continue in the employment of
the County, or as a limitation of the right of the County to discharge any of its Employees,with
or without cause.
Section 8.03 NO FUNDING REQUIRED
Except as otherwise required by law:
(a) Any amount contributed by a Participant to provide benefits hereunder shall
remain part of the general assets of the County and all payments of benefits under the Plan shall
be made solely out of the general assets of the County,
(b) The County shall have no obligation to set aside any funds, establish a trust, or
segregate any amounts for the purpose of making any benefit payments under this Plan, other
than the funds contributed by the Plan Participants for the payment of premiums on a pre-tax
basis. However, the County may in its sole discretion, set aside funds, establish a trust, or
segregate amounts for the purpose of making any benefit payments under this Plan.
(c) No person shall have any rights to, or interest in, any Account other than as
expressly authorized in the Plan.
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Section 8.04 GOVERNING LAW
The Plan shall be construed in accordance with and governed by the laws of the state of
Florida to the extent not preempted by Federal law.
Section 8.05 TAX EFFECT
The County does not represent or guarantee that any particular federal, state or local
income,payroll,personal property or other tax consequence will result from participation in this
Plan. A Participant should consult with professional tax advisors to determine the tax
consequences of his or her participation.
Section 8.06 SEVERABILITY OF PROVISIONS
If any provision of the Plan shall be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions hereof, and the Plan shall be construed and
enforced as if such provisions had not been included.
Section 8.07 HEADINGS AND CAPTIONS
The headings and captions herein are provided for reference and convenience only, shall
not be considered part of the Plan, and shall not be employed in the construction of the Plan.
Section 8.08 GENDER AND NUMBER
Except where otherwise clearly indicated by context,the masculine and the neuter shall
include the feminine and the neuter,the singular shall include the plural, and vice-versa.
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ADOPTION AGREEMENT
MONROE COUNTY BOARD OF COUNTY COMMISSIONERS
AMENDED AND RESTATED SECTION 125 CAFETERIA PLAN
The undersigned Employer hereby adopts the Section 125 Cafeteria Plan for those
Employees who qualify as participants hereunder. The Employer hereby selects the
following Plan specifications:
I. Employer Information.
Name of Employer: Monroe County Board of County Commissioners
Address: 1100 Simonton Street,Key West, FL 33040.
Employer's Tax ID No.: 59-6000749
Employer Contact: Teresa Aguiar,Director Employee Services,
(305)292-4458
Name of Plan: Monroe County Section 125 Cafeteria Plan.
Effective Date: January 1,2015
The Employer is the Plan Administrator and Plan Sponsor.
H. Plan Year: The Plan Year of the Plan will begin on January 1 and end on
December 31.
III. Eligibility Requirements for Participating Employees.
A. The following groups of persons as defined in the Monroe County
Personnel Policies and Procedures Manual are eligible to participate in the
Section 125 Plan upon meeting the requirements set forth in Schedule A:
Full-time regular employees of Monroe County Board of County
Commissioners;part-time employees working at least 25 hours per week;
persons employed under special grants/projects; trainee employees;
contract employees,provided fringe benefits are included within the
contract; elected County Commissioners,while in office(collectively,
"Participants").
B. The following groups of employees are not eligible to participate in the
Section 125 Plan:
1. Independent contractors or self-employed individuals;
2. Temporary, substitute, or emergency temporary employees as
defined in the Monroe County Personnel Policies and Procedures
Pagel o f 3
Y
Manual("Manual"), other than persons hired under special
grants/projects,as stated in paragraph(A), above; and
3. Part-time employees working less than 25 hours per week;
4. Contract employees,unless the benefit is stated in their contract;
and
5. Employees less than 18 years of age.
C. Eligibility: 60 days following employment.
D. Age: Minimum age— 18.
E. The term "compensation"as used herein and in the Plan Document shall
include regular base salary, as it may be adjusted from time to time. The
term "compensation"shall exclude:
I. Overtime
2. One time only lump sum merit increases.
3. Years of Service awards and other longevity pay.
4. Severance payments.
IV. Employee Compensation
A. Elective Contributions (salary reduction). Each Participant may authorize
the Employer to reduce his or her compensation by the amount needed for
the purchase of optional benefits elected. An election for salary will be
made on the benefit election form circulated by the Plan Administrator.
V. Available Benefits: The following optional benefits are available to Plan
Participants:
1. Group health(self-insured). The terms, conditions and limitations
for medical coverage will be as set forth in the health plan
document and/or summary of benefits document.
2. Dental coverage—The terms, conditions and limitations for dental
coverage will be as set forth in the insurance policy.
3. Vision coverage—The terms, conditions and limitations for vision
coverage will be as set forth in the insurance policy.
VI. The plan is subject to FMLA and COBRA.
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VH. Employer's Execution of Adoption Agreement
Having made the elections described in this Adoption Agreement,the Employer
hereby adopts the Plan(consisting of this Adoption Agreement and the Section
125 Cafeteria Plan document), which Plan is hereby executed in its name and on
its behalf by a duly authorized representative of the Employer,or his or her
authorized delegate.
FOR THE EMPLOYER
Signature:
Printed Name: Danny Kolhage
Title: Mayor/Chairman
Date: December 2014
(SEAL)
ATTEST:
AMY HEAVILIN,CLERK
By:
Deputy Clerk
Approved as to form and legal sufficiency:
Assistant County Attorney
Monroe County Attorney's Office
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