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Text: Nixon Peabody's August 2004 Benefits Briefs: Legal Developments for Employee Benefits (PDF)

6 pages. Articles include: Getting burned by ignoring people with 'colorable' claims to plan participation; Court holds that ERISA forbids a plan from recouping excess benefit payments in court; Anti-cutback rule KOs suspension of benefits amendment.

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Text: Nixon Peabody's September 2004 Benefits Briefs: Legal Developments for Employee Benefits (PDF)

7 pages. Articles include: What's discrimination in the design of ERISA plans?; Elect-it-yourself tax treatment for disability benefits; Insurance companies as plan fiduciaries; Retiree health benefits--Vested or not?

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Peabody v. Davis Exposes Potential Risks for Fiduciaries of Eligible Individual Account Plans

The Court acknowledged that EIAP's are exempt from the duty to diversify, but nevertheless concluded that the fiduciaries had a duty to reduce exposure to company stock in an orderly way, as company profitability abruptly and openly dropped. Although the facts of the case are unique, the ruling may expose potential risks for the fiduciaries of EIAPs.'  MORE >>

Peabody Energy Cleared in ERISA Challenge to Stock Losses

"The proposed class action argued that Peabody wrongfully kept company stock in its workers' retirement plans during a period in which the company was under investigation for allegedly making misstatements about the effects of climate change on its business prospects. A federal district court refused to hold Peabody liable for these actions under [ERISA], saying that the employees failed to overcome the strict pleading standards set by the U.S. Supreme Court in ERISA cases over employer stock." [Lynn v. Peabody Energy Corp., No. 15-916 (E.D. Mo. Mar. 30, 2017)]

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ERISA at 40: ERISA, Nixon, and the Could-Have-Been ACA (PDF)

"This article looks at the Nixon administration's proposal to reform the US health care system, presented to Congress in 1974 -- the same year ERISA was enacted. Although it wasn't adopted, the proposal included a number of provisions that are surprisingly similar to those appearing in the Affordable Care Act."

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Miners Arrested in Fight to End Peabody's Termination of Retiree Health Benefits

"In 2007, Peabody Energy and Arch Coal spun off a large chunk of their health care and retirement obligations to a new entity called Patriot Coal. In a financial and bankruptcy transaction that UMWA Vice President from Alabama, Daryl Dewberry, described as 'nickel slick', Peabody Energy and Arch Coal are trying to wash their hands of responsibility for the health benefits for which they had signed contracts."  MORE >>

CMS Excludes Account-Based Plans from Medicare Part D Notices

"The final rule codifies that account-based medical plans, specifically HRAs and ICHRAs, are no longer required to determine, document, or disclose their creditable coverage status to Part D-eligible individuals. CMS concluded that the fundamental design of account-based arrangements -- which provide tax-free reimbursements for medical expenses and individual policy premiums rather than comprehensive prescription drug benefits -- makes actuarial comparisons to the Medicare standard drug benefit inapplicable."  MORE >>

Employer-Favorable Trend Emerges from Tobacco Cessation Class Actions

"Employers facing tobacco-surcharge litigation have stronger authority to argue that removing the surcharge prospectively after completion of a cessation program satisfies ERISA's 'full reward' requirement without retroactive refunds.... By treating wellness program adoption as a settlor function rather than a fiduciary act, the courts provide additional grounds to defeat fiduciary-breach claims tied to the design and funding effects of these programs."  MORE >>

Proposed Safe Harbor for Fiduciary Selection of 401(k) Investment Options

"The proposed rule gives fiduciaries 'maximum discretion' to include alternative assets on plan menus. Following the safe harbor's six-factor framework is likely to establish a presumption of prudence. Plan sponsors and their counsel should begin aligning investment selection and monitoring processes with the six-factor framework now."  MORE >>

Trump Accounts as an Employee Benefit

"While the [Notice 2025-68] and the Proposed Regulations provide important clarity on how Trump Accounts are opened ... several open questions still remain.... [1] Eligible investment; [2] Distributions during and after the Growth Period; [3] Reporting requirements for trustees and custodians ... [4] Nondiscrimination testing for Code Section 128 employer contribution programs; [5] Guidance exempting Trump Accounts from ERISA (similar to that of HSAs); [6] Coordination of salary reduction contributions with Code Section 125 rules."  MORE >>

Updated Model HIPAA and Part 2 Notices Released, OCR Enforcement Authority Commences

"[M]any HIPAA covered entities must implement updates to align certain Part 2 regulations with the HIPAA Privacy Rule. Guidance is now available for Notice of Privacy Practices (NPP) updates. OCR's Part 2 enforcement authority becomes active on February 16, 2026, and OCR has opened its portal for Part 2 complaints. To the extent separate from their HIPAA NPP, SUD providers now have a model Part 2 Patient Notice from OCR."  MORE >>

New ERISA Class Actions Challenge 'Voluntary' Accident, Critical Illness, and Hospital Indemnity Benefits

"These filings signal a coordinated litigation strategy that could fundamentally reclassify certain 'voluntary' benefits as ERISA‑covered plans, significantly expanding fiduciary exposure for employers. By targeting both employers and national benefits consultants, the lawsuits raise the stakes for plan design, vendor relationships, and long‑standing assumptions about ERISA's safe‑harbor boundaries."  MORE >>

February 16: Deadline for Notice of Privacy Practices Update, Part 2 Enforcement by OCR Begins

"In addition to the required NPP changes going into effect on February 16, 2026, OCR's authority to enforce Part 2 will take effect, which will allow the following: [1] Individuals will be able to file complaints with OCR for alleged Part 2 violations; [2] Part 2 providers will be required to report breaches of unsecured Part 2 records; and [3] OCR can begin investigation and enforcement activities, including the imposition of civil monetary penalties for violations."  MORE >>

AI in Benefits Administration: Opportunities and Oversight

"AI is being used to streamline tasks such as verifying eligibility, adjudicating claims, and reconciling payroll. Service providers are deploying systems that can detect anomalies in claims data and tailor outreach based on participant demographics and financial needs.... Errors, such as misclassified procedures or misallocated funds, can occur, and accountability ultimately rests with the plan fiduciary, regardless of the technology involved.... Vendor relationships should be structured to allow for ongoing monitoring and documentation of AI-driven decisions."  MORE >>

Federal FAQs Clarify Pathways for Employer Coverage of Fertility Benefits

"Specified-disease policies for infertility can be offered today if insured and noncoordinated. Excepted benefit HRAs can reimburse out-of-pocket fertility expenses within indexed limits. EAPs may include fertility navigation supports without becoming significant medical coverage. With potential rulemaking on the horizon, sponsors should align near-term offerings with current rules and be ready to evaluate new limited excepted benefit options as they emerge."  MORE >>

Upcoming Deadline for Tax-Exempt 457(b) Plan Sponsors

"Tax-exempt sponsors must amend 457(b) plans by the December 31, 2025, deadline to comply with SECURE Act and SECURE 2.0 -- no extensions apply. RMD age increases, beneficiary rules, and automatic cash-out maximums may require updates; sponsors should align documents and operations now to avoid issues."  MORE >>

2026 Health and Fringe Benefit Plan Limits

"As open enrollment begins, employers should be strategic and consistent about communicating these changes to employees."  MORE >>

Fiduciary Risks in Pharmacy Benefits: A Checklist for Plan Sponsors

"[1] Conduct an independent legal review.... [2] Consider a request for proposals (RFP).... [3] Identify above-market pricing and hidden revenue.... [4] Renegotiate or implement new terms.... [5] Audit for overcharges.... [6] Educate your fiduciaries. "  MORE >>

IRS Finalizes New 401(k)/403(b) Catch-Up Contribution Regs

"Final regulations also provide some clarity on the optional 'super' catch-up contributions that were permitted starting on 2025. Plan sponsors have several design and administrative decisions to make before implementing these changes, and plan amendments reflecting these changes are due by December 31, 2026."  MORE >>

Federal Funding Cuts Impact Essential Health Plan Benefits for New Yorkers

"New York State plans to end its Section 1332 Waiver and revert to the Basic Health Program due to major federal funding cuts. Essential Plan eligibility will be limited to residents with incomes up to 200% of the Federal Poverty Level (FPL). The state is seeking comments on the proposed transition through October 10, 2025."  MORE >>