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<< Older News   |  February 26, 2017

Benefits in the News


Text of CMS Insurance Standards Bulletin: Extension of Transitional Policies Through Calendar Year 2018 (PDF)
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]
[Official Guidance]
Feb. 24, 2017
"States may permit issuers that have renewed policies under the transitional policy continually since 2014 to renew such coverage for a policy year starting on or before October 1, 2018; however, any policies renewed under this transitional policy must not extend past December 31, 2018.... This approach will facilitate smooth transitions from transitional coverage to [ACA-compliant] coverage, which requires a calendar year policy year in the individual market." [Editor's note: a 'transitional' policy sometimes is called a 'grandmothered' policy.]
Administration Moves to Stabilize Marketplace for 2018
Wolters Kluwer
[Guidance Overview]
Feb. 24, 2017
"[HHS has] issued a Proposed Rule designed to stabilize the individual and small group markets by addressing some of insurers' concerns in hopes of keeping them in the marketplace. The Proposed Rule would change the standards relating to special enrollment periods (SEPs), guaranteed availability, the timing of the annual open enrollment period (OEP) in the individual market for the 2018 plan year, network adequacy and essential community providers for qualified health plans (QHPs), and the rules around actuarial value requirements. It also announces upcoming changes to the qualified health plan certification timeline."
Retirement is an Artificial Finish Line
Paladin Research & Registry
[Opinion]
Feb. 24, 2017
"Women and men are discovering that retirement is not a natural life transition. It's an idea that's been inflicted upon us by corporations and society. We've been indoctrinated into thinking that when you turn 65, it's time to punch out and live a life of leisure. This may have worked for the previous generation, but that mindset is no longer sustainable. Pensions and institutional stewardship have gone the way of the dinosaur, and today more than ever we have to assume control over our own retirement planning."
The Retirement System Diaries, Chapter 1: The So-Called Retirement Crisis (PDF)
Pete Swisher, Pentegra Retirement Services, via Journal of Pension Benefits
[Opinion]
Feb. 24, 2017
"There is a real retirement crisis in the United States, but there is also a fake one. This article attempts to bring some levity and perspective as to which pieces of the sky are, in fact, falling.... [By] 'crisis' we don't mean anything obvious like war, famine, or national penury. Instead, 'retirement crisis' has come to mean simply that people aren't saving as much as they should and won't be able to retire with enough money to maintain their late-career standard of living. Admittedly, no one ever says it that way, but that's what they mean. This is not a crisis."
ECFC Letter Requesting Guidance for Qualified Small Employer Health Reimbursement Arrangements Under the 21st Century Cures Act (PDF)
Employers Council on Flexible Compensation [ECFC]
[Opinion]
Feb. 24, 2017
"[G]uidance is needed for employers to understand whether they are currently offering a disqualifying group health plan.... We would like confirmation that an employer could, in fact, offer a QSEHRA that limits reimbursements to premiums for health insurance.... [A] QSHRA that reimburses at the maximum for individual and family coverage should be considered as providing coverage under the same terms for all eligible employees regardless of the difference in price between a health policy with single coverage and one with family coverage.... An employer's involvement with after-tax payroll deduction for any excess cost of a QSEHRA funded policy (i.e., amounts in excess of the statutory limits) should not cause the employer to become ineligible to offer a QSEHRA ... It would be helpful ... for the Agencies to provide a model notice that will satisfy the requirements for the notice."
Top U.S. Tax Firms Carry Wealthy 401(k) Plans on Their Books
Bloomberg BNA
Feb. 24, 2017
"Retirement savings in 401(k) plans among the nation's 10 top-grossing accounting firms range from $439 million to $5.47 billion ... The top three firms by revenue -- Deloitte, PwC and E&Y -- have established more than one retirement plan for their employees. Both Deloitte and E&Y have 401(k) plans specifically for partners and other highly compensated employees.... The average account in Deloitte's plan for partners is $781,416 -- this is more than 10 times the average account of those participants in the other plan, which is $73,723."
American Academy of Actuaries Response to PBGC Request for Information on Alternative Two-Pool Withdrawal Liability Methods (PDF)
Multiemployer Pension Plans Subcommittee, American Academy of Actuaries
Feb. 24, 2017
10 pages. "The primary risk to participants is that the two-pool arrangement will result in the plan being less well-funded over time than it would have been if some other course of action had been followed within a typical arrangement.... The risks to new pool employers are primarily the result of possible uncertainty regarding certain aspects of the two-pool arrangements, particularly as it relates to the extent to which the pools receive separate treatment and in regard to the extent to which a two-pool arrangement can include favorable provisions that apply in the event of a future mass withdrawal."
Monte Carlo Analysis vs. the Actuarial Approach
Ken Steiner, FSA Retired
Feb. 24, 2017
"Many financial advisors utilize Monte Carlo analysis (MCA) to help their clients develop financial plans in retirement.... [T]here are several potential problems with MCAs and some of these problems can be mitigated if financial advisors: stress that 'Clients should understand planning is not a one-time occurrence', 'Emphasize the importance of ongoing planning', and 'Present information in more than one way.' "
OIG Report: $1 Billion Paid by Social Security to Individual Representative Payees Who Do Not Have a Social Security Number (PDF)
Office of the Inspector General [OIG], Social Security Administration [SSA]
Feb. 24, 2017
20 pages. "SSA is required to obtain the SSNs of representative payee applicants. SSA uses the representative payee's SSN to [1] verify the payee's identifying information; [2] determine whether the payee applicant is receiving Old-Age, Survivors and Disability Insurance or Supplemental Security Income; [3] determine whether the applicant is a convicted felon; and [4] determine whether the applicant previously served as a representative payee and has a history of poor payee performance or misuse.... [OIG estimates] that 22,426 beneficiaries had an individual representative payee who did not have an SSN, and SSA had not followed its policy to retain the paper application.... From April 2006 to September 2016, SSA paid these representative payees about $1 billion."
Cybersecurity Risks and Liabilities for Employers, Retirement Plan Sponsors and Fiduciaries (PDF)
Winstead PC, in Pension & Benefits Daily
Feb. 24, 2017
"While there is no regulatory scheme protecting the personal data provided to retirement plans, such as ... under HIPAA privacy and security for health plans, ... that does not mean there is no obligation to keep the personal information secure. There is a protection requirement under ERISA, if a Plan Sponsor utilizes electronic methods of distribution of plan information."
Interesting Angles on the DOL's Fiduciary Rule, Part 37
FredReish.com
Feb. 24, 2017
"In 2015, the Office of Compliance Inspections and Examinations (OCIE) of the SEC issued a National Exam Program Risk Alert describing its 'Retirement-Targeted Industry Reviews and Examinations Initiative' (ReTIRE).... [T]here are agencies, in addition to the [DOL], that are focused on advisers' practices for retirement investing and related activities (for example, the recommendation of rollovers)."
Administration Allows States to Extend Transitional Policies Again
Timothy Jost, in Health Affairs
[Guidance Overview]
Feb. 24, 2017
"These plans will continue to be exempt from most of the ACA's insurance reform provisions which otherwise became effective on January 1, 2014, including the ban on health status underwriting; the guaranteed availability and renewability requirements; the essential health benefits, annual out-of-pocket limit and actuarial value requirements; the ban on preexisting condition exclusions; and the requirement that all individual and small group market plans of an insurer be part of a single individual or small group risk pool."
Importance of Accuracy in ESOP Data Collection
Principal Financial Group
Feb. 24, 2017
"Reviewing and understanding your plan's definition of compensation is the key to making sure that all the right elements of compensation ... are recorded properly in your census data file.... It is important to review your plan document and understand which method is used for determining Hours of Service (hours worked or elapsed time).... Each year it is important to provide your recordkeeper with any company changes as those changes could impact the allocation and compliance testing process for the plan year."
Not Ready to File the Forms 1094-C and 1095-C? How to Request an Extension from the IRS
Accord Systems, LLC
[Guidance Overview]
Feb. 24, 2017
"An employer who has elected to, or is required to, file electronically will have until March 31, 2017 to file the Forms 1094-C and 1095-C. If an employer is not prepared by the requisite deadline, the employer may receive an automatic 30 day extension by filing a Form 8809 with the IRS. This extends the paper deadline until March 30, 2017 and the electronic deadline to May 1, 2017. This article provides basic instructions regarding how an employer should complete the Form 8809."
Fewer Small Employers Offering Health Insurance
Washington Examiner
Feb. 24, 2017
"[T]he total percentage of employers offering insurance fell to 45.7 percent in 2015, a 1.8 percentage point drop from 2014. Larger employer offers of insurance increased by 1.2 percentage points to 96 percent in 2015 compared to 2014. But that was offset by small employers -- only 29.4 percent of them offered insurance, a 2.8 percent drop."
Detroit Mayor Proposes Trust Fund to Cover Future Pension Payments
U.S. News & World Report
Feb. 24, 2017
"Under the plan, fund deposits and interest earnings would total $377 million by the end of fiscal 2023 ... Detroit, which exited the biggest-ever municipal bankruptcy in December 2014, has already set aside $70 million for the higher pension payments. The court-approved bankruptcy exit plan had projected city pension payments to spike to $111 million beginning in fiscal 2024 after years of minimal or no payments by the city. But a subsequent actuarial analysis pegged the payment spike at $200 million or more."
Jury to Decide Whether Police Sergeant's Protest of FMLA Policy Warranted Denial of Promotion
Wolters Kluwer
Feb. 24, 2017
"A police sergeant who was initially denied his request to use his accrued sick leave to care for his wife following childbirth complications due to the employer's erroneous belief that he sought 'paternity' leave, and also was denied his request not to have the leave designated as FMLA leave, avoided summary judgment on his FMLA interference claim. The federal court in Nevada also allowed him to advance his retaliation claim ... because whether his protected activity was carried out in such a manner that it became a legitimate reason for the decision should be decided by a jury[.]" [Browett v. City of Reno, No. 16-181 (D. Nev. Feb. 17, 2017)]
A Factor in Higher Healthcare Costs: When Evidence Says No, but Doctors Say Yes
The Atlantic
Feb. 24, 2017
"For all the truly wondrous developments of modern medicine ... it is distressingly ordinary for patients to get treatments that research has shown are ineffective or even dangerous.... In 2014, two researchers ... found that typical adults attributed about 80 percent of the increase in life expectancy since the mid-1800s to modern medicine. 'The public grossly overestimates how much of our increased life expectancy should be attributed to medical care,' they wrote ... This perception, they continued ... 'may also contribute to overfunding the medical sector of the economy and impede efforts to contain health care costs.' "
American Benefits Council Comment Letter to IRS on Minimum Present Value Requirements for DB Plan Distributions
American Benefits Council
[Opinion]
Feb. 24, 2017
"The possibility of requiring lump sums to be based on a subsidized early retirement benefit would be in effect a major government-required benefit increase, which is inconsistent with current law. The proposed treatment of social security level income options and post-normal retirement age benefits would similarly impose major new obligations on employers, without a basis in the law. The treatment of employee-derived benefits is ... inconsistent with prior guidance and would impose material costs to plans."
An Ironic Twist to 401(k) Fee Lawsuit Settlements: 'Physician, Heal Thyself'
Greenspring
[Opinion]
Feb. 24, 2017
"[It] appears these companies who manage corporate retirement plans for their clients can't even properly oversee their own 401k plans for their own employees from a fiduciary standpoint.... [M]any companies think these vendors have their best interests in mind. If you are a plan sponsor or a plan fiduciary, you've got to ask yourself 'if these service providers can't manage the fees in their own plans how confident can I be they are helping me manage the fees in my plan?' "
Justice Department Joins Whistleblower Suit Accusing UnitedHealth Group of Overcharging Medicare by 'Hundreds of Millions'
Sheppard Mullin
Feb. 24, 2017
"The suit accuses United of operating an 'up-coding' scheme to receive higher payments under [Medicate Advantage's] risk adjustment program ... The complaint alleges that United fraudulently collected 'hundreds of millions -- and likely billions -- of dollars' by claiming patients were sicker than they really were."
ECFC Letters to Congress in Support of Proposed Health Savings Act (PDF)
Employers Council on Flexible Compensation [ECFC]
[Opinion]
Feb. 24, 2017
"Enhancing access to Health Saving Accounts (HSAs) by expanding eligibility rules and increasing the maximum contribution limit and allowing their funds to be used for evolving health care needs and services, helps American families save for and manage their growing health care expenses. [ECFC believes] that the provisions of this bill should be included in any effort made by Congress to reform the health care system."
Supreme Court Will Not Review Enforceability of Forum Selection Clauses in ERISA-Governed Benefit Plans
Butterfield Schechter LLP
Feb. 24, 2017
"While the only two U.S. appellate courts to rule on the issue of forum selection clause enforceability as it relates to ERISA benefit plans (i.e., the 6th and 8th Circuits) have upheld their validity, ... several U.S. district courts within other circuits have found these clauses unenforceable ... [W]hile forum selection clauses within ERISA-governed benefit plans may continue to be enforced in the 6th and 8th Circuits, other circuits are still free to adopt the opinion that such clauses are invalid and thus unenforceable."
Text of SEC Investor Bulletin: Robo-Advisers
U.S. Securities and Exchange Commission
Feb. 23, 2017
"Before making a decision about whether to invest through a robo-adviser, or in deciding which robo-adviser might be best for you, you should do your own research. Make sure the robo-adviser and the investment portfolio it puts together for you are a good match for your investment needs and goals, and that you understand the potential costs, risks, and benefits of using that particular robo-adviser. [This bulletin highlights] some issues you may want to consider in making these important decisions."
Voters in Arizona and Washington State Approve Paid Sick Leave Mandates
Willis Towers Watson
Feb. 23, 2017
"Arizona and Washington have recently joined Connecticut, California, Massachusetts, Oregon and Vermont in mandating statewide paid sick leave, and Montgomery County, Maryland, expanded its existing paid sick leave law. Going in the opposite direction, Ohio banned paid sick leave mandates, and five jurisdictions in Illinois opted out of a county law mandating paid sick leave."

<< Older News   |  February 26, 2017


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