Form 5500 filing is an essential part of any employee benefit plan sponsor’s compliance responsibilities. These annual reports, required to be filed with the Internal Revenue Service (IRS) and Department of Labor (DOL), provide information to these agencies on employee benefit plans that are subject to ERISA.

Unless the type of plan or plan sponsor meets a Form 5500 filing exception (for example, certain insured and unfunded welfare plans sponsored by small employers, and church plans, are among those not subject to the Form 5500 filing and disclosure requirements), substantial penalties can apply for failing to file the annual report. Penalties can be assessed against late filers — those filing after the deadline — and non-filers. Incomplete forms, such as those missing any required schedules or which are not signed or dated, are not considered properly filed until these errors are corrected. Penalties from the IRS can run as high as $25 per day, up to $15,000, and those from the DOL can run up to $1,100 per day, with no maximum.

Most failures to file a Form 5500 when due are not willful. An employer might be under the mistaken impression that a certain plan it sponsors does not require a filing, or it might overlook the deadline on account of other more pressing business concerns, or it might file the 5500 but forget to attach a required schedule. When the plan sponsor then discovers the oversight, it could be in a quandary as to how to proceed — especially if a significant amount of time has passed since the filing deadline — knowing that a late filing will bring on potentially sizable penalties.

In an effort to encourage voluntary correction of these inadvertent non-filings, the DOL offers the Delinquent Filer Voluntary Compliance Program (DFVC). The program is designed to encourage plan sponsors, or their administrators, to file overdue annual reports by assessing a reduced penalty instead of the penalty amount that would otherwise apply. For example, the basic penalty under the program is $10 per day for delinquent filings, with the maximum penalty of $750 for a single late report for a small plan (generally, a plan with fewer than 100 participants at the beginning of the plan year) and $2,000 for a large plan. In the event that a report has not been filed for several years, the program also has a per-plan cap, which generally limits the penalty to $1,500 for a small plan and $4,000 for a large plan, regardless of the number of late reports filed at the same time for a single plan.

Although the program is offered by the DOL, the IRS also provides penalty relief for late Form 5500 filings that meet the requirements of the DFVC program.

The DFVC program is only open to plan sponsors that have not been notified in writing by the DOL of Form 5500 filing noncompliance. The plan sponsor calculates the applicable penalty and submits it at the time of the DFVC filing, which must include the late report(s) and any required attached schedules. The plan sponsor or administrator is liable for the required penalty, and cannot pay it out of plan assets. By paying the penalty under the DFVC program, the plan sponsor or administrator waives the right to contest the penalty amount at a later date.

Given the steep penalties that can apply for neglecting to file 5500s for the employee benefit plans you sponsor, all employers would be well-advised to ensure that they are up to date with this annual requirement. If you have not filed reports for any plans believing that they are not subject to the annual reporting and disclosure requirement, consider double-checking with your company’s employee benefits, tax or accounting professional to make sure that this indeed is the case. If you’ve overlooked meeting the filing requirement for any plan, see if you can use the DFVC program to keep your penalties in check.


Although the overall quality of health care delivered by U.S. providers continues to improve, use of prevention tools lags, resulting in missed opportunities to avoid certain serious diseases and their complications, according to annual reports from the Agency for Healthcare Research and Quality (AHRQ).

“Less than Optimal”

The most recent editions of the National Healthcare Quality Report and the National Healthcare Disparities Report found less than optimal participation in cancer screenings, obesity counseling, and disease management strategies by individuals with chronic conditions such as diabetes and asthma. These missed opportunities can increase health care costs and deter effective prevention and treatment of disease.

The AHRQ quality measures look at the extent to which health care providers deliver evidence-based care for specific services, as well as the outcomes of the care provided. Forty-two core measures focus on four aspects of quality — effectiveness, patient safety, timeliness and patient-centeredness — during four stages of care: Staying healthy, getting better, living with an illness or disability, and coping with the end of life.

Modest Improvements

Overall, most measures show improvement, though on a modest basis, according to the report on quality. Hospitals demonstrated most improvement, outpacing other centers of care, such as ambulatory care, nursing home care and home health care. Specifically, hospital care for heart attack patients improved 15%, for pneumonia patients almost 12%, and for avoidance of complications after surgery more than 7%.

The median rate of improvement for acute care quality measures was about twice that for preventive and chronic care quality measures. Delving further into this difference, while vaccinations for children, adolescents and the elderly showed high rates of overall improvement, the improvement rate for other preventive measures — screenings, advice and prenatal care — was low.

For example, only half of adults received recommended colorectal cancer screenings; fewer than half of obese adults reported receiving diet counseling from a health care professional; less than half of asthmatics received advice on how to change their environment and only 28% said they had received an asthma management plan; and less than half of diabetics received the screenings recommended for this disease (blood sugar tests, foot exams and eye exams) to prevent disease complications.

The second AHRQ report examined disparities related both to the quality of and access to health care among racial, ethnic and socioeconomic groups in the U.S. The measures of quality were the same used in the report discussed above, while access measures assessed how easily patients are able to get needed care and their actual use of services.

Disparities Pervade Health Care System

According to the report, disparities continue to “pervade” almost all aspects of the U.S. health care system, with racial/ethnic minorities receiving lower quality care and worse access to care on most measures, and poorer populations receiving lower quality care on most measures and worse access to care on all measures. Disparities were particularly apparent in the area of prevention. Neighborhood solutions and focused community-based projects are the keys to eliminating these disparities, the report says.