[Guidance Overview]
Roundup of Recent Regulatory Guidance on Health Care Reform (PDF)
"This Client Action Bulletin discusses PCORI funding, a Medicare Part A payroll tax increase, guidance on transitional reinsurance fees and wellness programs, as well as other regulations related to healthcare reform. The bulletin also provides guidance on actions employers should undertake."
(Milliman)
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Health Reform Implementation in Relation to Unions and Labor
"Employers can't be instantly ready for how health reform will transform their health plans in 2014; they have to do all the heavy lifting in 2013 in order to achieve preparedness ... Some plans are going to lose the ability to tailor benefits for the goal of recruitment, retention and union demands. Others will need to scale back extras in order to comply with new areas of coverage required by reform, or to keep health costs under control. But they'll have to do so in a way that does not alienate employees or galvanize unions."
(Thompson SmartHR Manager)
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Deloitte Health Care Reform Memo, December 24, 2012
Articles in this issue include: ACA implementation calendar: 2013; Contraceptive coverage rule legal challenges: update; School-based health centers receive $80 million in federal funding; Patient advocacy groups encourage broader drug coverage in EHBs; ACA premium tax credits challenged; and Social security cuts on table using "chained CPI."
(Deloitte)
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Contraceptives Dispute Reaches U.S. Supreme Court
"Two profit-making companies run by religious families who have strong anti-abortion views have asked the Supreme Court for an emergency order to protect them from the new federal mandate requiring employers to provide free health insurance for emergency contraceptives for their workers. They also asked the Court to decide their religious freedom plea promptly, without waiting for a federal appeals court to rule." [Hobby Lobby Stores, et al., v. Sebelius, et al. (docket 12A644).]
(SCOTUSblog)
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ERISA Does Not Preempt Medical Provider's Misrepresentation Claim Against Health Plan Insurer
"This decision draws attention to possible liability to third parties under state law. And since the court's reasoning is not limited to insured plans, those representing self-insured and insured plans alike are reminded of the need for careful, documented communications on plan matters." [Access MediQuip LLC v. UnitedHealthcare Insurance Co., 662 F.3d 376 (5th Cir. 2011), reinstated in part on rehearing, 698 F.3d 229 (5th Cir. 2012)]
(Thomson Reuters / EBIA)
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HHS Launches Online Resources for Safeguarding PHI on Portable Electronic Devices
"While specifically addressed to health care providers, the principles are applicable to all covered entities -- including health plans -- and their business associates that store or transmit PHI using portable electronic devices. As use of mobile devices becomes increasingly prevalent, health plan sponsors and business associates can use the educational materials as a resource for security rule compliance, including assessment of risk, establishment of policies and procedures, and development of training programs."
(Thomson Reuters / EBIA)
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Federal Judge Blocks Missouri Law Requiring Insurers to Offer Policies Excluding Contraceptive Coverage
"A federal judge has blocked a new Missouri law requiring insurers to offer policies excluding birth control coverage because it conflicts with a federal law mandating such coverage.... Missouri's law requires insurers to issue policies without contraception coverage if it runs contrary to the religious or moral beliefs of an individual or employer. The law appeared to be the first in the nation to directly rebut an Obama administration policy requiring insurers to cover birth control at no additional cost to women."
(InsuranceNewsNet)
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Government Employees in Missouri Indicted for Defrauding Employer-Sponsored Wellness Program
"According to an indictment filed in the U.S. District Court for the Western District of Missouri, within the first six months of the existence of the Points to Blue wellness program in 2010, member employees of Jackson County and Kansas City, Missouri, began falsifying activity entries ... by falsely claiming to have completed the most strenuous activities in order to obtain the maximum value gift card or preloaded debit card in the amount of $250.... The employees altogether received 1,253 gift cards totaling $310,960. Each employee faces a maximum of 60 years in prison and a $750,000 fine if convicted on all counts"
(PLANSPONSOR.com)
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Walking the Tightrope on Mental Health Coverage
"Insurance covers more mental health care than many people may realize, and more people will soon have the kind of health insurance that does so. But coverage goes only so far when there aren't enough practitioners who accept it -- or there aren't any nearby, or they aren't taking any new patients.... According to this year's Society for Human Resource Management survey of 550 employers of all sizes, including nonprofits and government entities, 85 percent offer at least some mental health insurance coverage."
(The New York Times; free registration required)
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Earn an Average Salary? Covering Your Health Spending Will Take 58.3 Workdays
"We usually think about the growth in health care spending in straight dollars, the number put toward medicine from one year to the next.... Right now, the average worker needs to work nearly two months of eight-hour work days -- 58.3 days, to be exact -- to purchase the average amount of health care spending. Back in 1958, that number stood at 14.8 days. This is really different ... from items like washers and dryers, or music players, where there's been a significant decline in the number of work days."
(The Washington Post; free registration required)
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Medicaid Insurance in Old Age
"The Medicaid recipiency rate for those at the bottom income quintile stays around 60%-70% throughout their retirement. In contrast, Medicaid recipiency by higher-income retirees is much lower but increases by age, especially after age 90. Our preliminary results show that the annuity value of Medicaid payments is a hump-shaped function of permanent income. People in the middle of the income distribution receive more than those at the top or the bottom. Once one takes into account that the rich live longer, Medicaid is even less redistributive[.]"
(University of Michigan Retirement Research Center)
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HHS Approves Minnesota Exchange; Insurers Scramble to Develop Health Plans
"Some of the federal government's final rules may not be released until March, said Scott Keefer of Eagan-based Blue Cross and Blue Shield Minnesota. 'That really leaves a six-week period in April up until May 17 to get those products and forms and rates to the state,' Keefer said. 'Everyone across the country and all the carriers in Minnesota are going to be operating in that same compressed four- to six-week time frame.'"
(Kaiser Health News)
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Health Plans' Estimated Costs of Compliance with Expanded Federal Rate Review and with Data Collection for Risk Adjustment and Reinsurance
"In general, health plans estimated that the incremental cost of rate filing and data submission for federal rate review purposes would be roughly 70 percent higher than the HHS estimate. Health plans estimated that the cost per filing would be about $4,300. Plans estimated that the cost of the data collection process for risk adjustment and reinsurance could range from about $1.3 million (median estimate) to over $5 million (average estimate) per plan. HHS had estimated that the cost would be approximately $300,000 per plan and that the total system-wide cost would be just under $600 million. However, based on the health plans' estimates, the total system-wide cost could be well over $1 billion."
(AHIP Center for Policy and Research)
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What to Include or Exclude in W-2 Reporting Required by ACA
"For the 2012 tax year, employers who issued fewer than 250 W-2's for the 2011 tax year are excused from mandatory reporting, but may choose to test their payroll systems and report such amounts. For those who issued 250 or more W-2's in 2011, reporting is required. The Internal Revenue Service has published a chart (reproduced below) that details the type of coverage taken into account for Box 12, Code DD reporting."
(Society for Human Resource Management)
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Hands Tied: Businesses Look for Ways Around Health Care Law
"With the reality of the new health care law slowly setting in across the country, small businesses are making plans to protect themselves from the most onerous provisions. Some small businesses are making plans to cut workers hours to 30 hours a week. Or, pass the costs on to customers through a surcharge. Still others say they won't grow their business at all. Now the Wall Street Journal reports that some companies are looking at splitting their companies into separate entities to stay below the magical 50 employees threshold."
(U.S. Chamber of Commerce)
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[Opinion]
Text of Comments by Consumers Union to HHS on Proposed Standards for Essential Health Benefits, Actuarial Value, and Accreditation (PDF)
"[Consumers Union] strongly support[s] the following provisions of the proposed rule: [1] Selection of a single actuarial value (AV) calculator to ensure uniformity when measuring health plan coverage levels; [2] A robust standard for measuring employer minimum value; and [3] A strong process for identifying state EHB-benchmark plan designs. However, to realize the full promise of health reform, [CU urges] revision of some of the proposed regulations, particularly those dealing with the AV calculator, benefit substitution for essential health benefits (EHB), and anti-discrimination provisions."
(Consumers Union)
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[Opinion]
Text of Comments by ECFC to HHS on Proposed Regs for Notice of Benefit and Payment Parameters for 2014, Including Request for Extension of Comment Period (PDF)
"While we applaud CMS' and HHS' desire to quickly finalize the rules so that affected entities can begin implementation sufficiently in advance of 2014, we respectfully request that CMS extend the comment period to at least March 6, 2013 -- a period of no less than 90 days after the date the Proposed Rule was published.... There must be some balance between the need to ensure a timely implementation and the need to ensure an effective implementation.... The time currently allotted to submit comments will not afford a meaningful opportunity to review, which will prevent an effective implementation[.]"
(Employers Council on Flexible Compensation)
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Benefits in General; Executive Compensation
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[Guidance Overview]
NASDAQ Amends Compensation Committee Proposal
"While the substance of the proposal did not change too much, the transition requirements did, and became more workable.... In order to allow companies to make necessary adjustments to their boards and committees in the course of their regular annual meeting schedules, NASDAQ proposes that companies comply with the remaining provisions of the amended listing rules, as set forth in proposed NASDAQ Listing Rule 5605(d) and IM-5605-6, by the earlier of: (1) their first annual meeting after January 15, 2014; or (2) October 31, 2014."
(Dodd-Frank.com, a blog by Leonard, Street and Deinard)
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Impact of Special Dividends on Stock Compensation
"Companies paying dividends because of the lower tax rate on 'qualified' dividends may consider whether this places options and [restricted stock units] at a disadvantage (unless they pay a dividend equivalent), and they may want to think about how to adjust for this.... Many stock plans have provisions that allow for an adjustment or for equity restructurings, such as a special dividend, a stock split, or a spinoff. This is sometimes called an antidilution provision."
(myStockOptions.com)
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Vacation Days Becoming Employee-Friendly Commodity
"Many [employees] wish they could get more time away from the office, while others wonder how they'll ever use up all of their days off. Some employers offer a worker-friendly solution -- allowing employees to buy or sell vacation days or paid time off. For companies facing tight economic conditions, it's a way to offer a benefit that costs the company little but may help attract and retain employees. Employers who offer it say it gives people the flexibility they need to manage their lives."
(Atlanta Journal-Constitution)
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Trucker Huss Benefits Report for December 2012 (PDF)
Articles in this issue: Health Care Reform and Wellness Programs: Protecting Participants and Giving Employers More Flexibility; HHS Issues Additional Transitional Reinsurance Fee Guidance; and IRS 2012 Cumulative List.
(Trucker Huss)
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Press Releases
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