Health & Welfare Plans Newsletter

October 31, 2014

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Employee Benefits Jobs

Staff Accountant
T. Rowe Price
in MD

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Yang's Pension Consulting
in CA

Retirement Benefits Specialist
Pennsylvania Municipal Retirement System
in PA

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Stalker and Associates
in PA

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TPA Pension Firm
in AZ

Implementation Analyst
T. Rowe Price
in CO

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Webcasts and Conferences

Cafeteria Plan, Health FSA, and DCAP Mistakes: Finding, Fixing, and Preventing
RECORDED
(Thomson Reuters / EBIA)

An Analysis of Investor Behavior
November 11, 2014 in CO
(Western Pension and Benefits Conference-Denver Chapter)

Members-Only Specialty Session: Short-term and Long-term Incentive Plan Design and Related Issues
November 19, 2014 in CO
(Western Pension and Benefits Conference-Denver Chapter)

A Celebration of 50 Years of Colorado Wilderness
December 9, 2014 in CO
(Western Pension and Benefits Conference-Denver Chapter)

View All Webcasts and Conferences



[Guidance Overview]

Toeing the Line: The Coverage Eligibility Limits for a New Full-Time Employee in 2015
"One frustrating aspect of the [ACA] for employers is they can be in compliance with one area of the ACA and not in compliance with another area of the ACA. This frustration can be seen when an employer tries to determine the latest date it can make a new full-time employee eligible for coverage while still being in compliance with all of the ACA's provisions. The purpose of this article is to discuss the issues of eligibility surrounding new full-time employees hired in 2015 and to provide a chart ... [that] accurately summarizes the article for those readers who are not interested in the details and reasoning." (Health Care Attorneys P.C.)  


[Advert.]

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[Guidance Overview]

HPID Deadline is November 5
"If a plan is fully insured, the insurer will apply for the HPID. But if the plan has a self-funded component (e.g., prescription drug coverage), the plan will need an HPID. In determining if a plan has a self-funded component for this purpose, generally the flexible spending accounts and retiree health reimbursement accounts can be disregarded.... For employers with wrap plans that file a single Form 5500, it may be easier to obtain a single HPID for the entire plan, including all of the self-insured programs or 'subhealth plans' -- even if there are fully insured programs within the wrap plan[.]" (Sutherland Asbill & Brennan LLP)  

[Guidance Overview]

Consider Including New Rules for Mid-Year Election Changes in 2014 Year-End Section 125 Plan Amendments
"Although Notice 2014-55 provides a December 31, 2015 amendment deadline for these rules, it may be more efficient to add them to the plan in 2014 along with ... [a required] amendment reflecting the $2,500 (or lower) maximum contribution limit for [cafeteria plans that include] healthcare flexible spending accounts, effective January 1, 2013, [which] must be adopted by December 31, 2014. (The maximum contribution limit increases to $2,550 for 2015.) ... [Also, if the employer wishes to] allow employees to roll over (into 2015) $500 of unused healthcare flexible spending account funds, an amendment reflecting the rollover feature (and removing any 2-1/2 month grace period applicable to 2014 amounts) must be adopted by December 31, 2014." (Ogletree Deakins)  

[Guidance Overview]

CMS Presentation: FF-SHOP Updates and Live Q&A, October 28, 2014 (PDF)
46 presentation slides. "Purpose: [1] To provide FF-SHOP issuers with updates and announcements; [2] To update FF-SHOP issuers on Increment 2 Testing; [3] To update FF-SHOP issuers on employer back-end transaction testing; [and] [4] To answer participant questions." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  

Shocking New Wellness Plan Lawsuit Calls Into Question Typical Plan Design
"The Chicago office has filed three separate lawsuits in the past few months on wellness plans, but no other EEOC office has joined the effort. An employer which faces such a lawsuit would likely have some defenses. For example, an employer does not violate the ADA's 'no medical examination' rule if the medical examination is done to 'underwrite', 'classify' or 'administer' medical risks. An employer may also argue that its program does not violate the ADA under the 'voluntary' wellness program exception. The EEOC has acknowledged these exceptions exist, but has generally taken a narrow reading of the exceptions[.]" (Quarles & Brady LLP)  


[Advert.]

Getting the Most for Your Money: Auditing Your Employee Benefits Program

Sponsored by Lorman and BenefitsLink

November 6 webinar. This live webinar will walk you through how to thoroughly review each of the medical and nonmedical benefits to be sure they are truly meaningful, cost effective, and in legal compliance. BenefitsLink discount.



Latest Employer Wellness Plan to Draw EEOC Fire includes Biometric Screening Requirement
"In March 2010, with the President's support for an incentive-based approach to wellness and a statement of Congress' approval of such an approach to wellness, the [ACA] amended the HIPAA nondiscrimination and wellness provisions to allow employers to provide larger incentives to employees who satisfy requirements of the employer's health promotion and disease prevention (i.e., wellness program). Regulations implementing the HIPAA provision have been issued as well. They include 'bright-line' rules for determining the nature and extent of the incentives an employer may include in its wellness program.... The [EEOC] would effectively make meaningless the ACA and HIPAA provisions and regulations." (Jackson Lewis P.C.)  

Should Your Company Consider a Private Health Exchange? (PDF)
7 pages. "The exchange may offer valuable support in communication and enrollment services. However, a move in this direction requires a thoughtful vendor evaluation for cost and services offered. In addition, the defined contribution approach must be evaluated. Finally, a well-managed implementation process is critical.... [1] Important considerations in determining whether a private exchange is right for you ... [2] The basics of private exchanges ... [3] The potential services private exchanges offer ... [4] Different types of private exchanges and considerations with each type." (McGraw Wentworth)  

Survey Data on Health Insurance Coverage for 2013 and 2014 (PDF)
"As of June 2014, 10.3 million nonelderly adults (ages 18-64) gained health insurance coverage since the start of the [ACA] initial open enrollment period in October 2013. The uninsured rate among nonelderly adults fell by more than a quarter (26 percent), from 20.3 percent to 15.1 percent, comparing numbers as of June 2014 with the January 2012-September 2013 baseline period. African Americans and Latinos saw particularly large drops." (Assistant Secretary for Planning and Evaluation [ASPE], U.S. Department of Health and Human Services [HHS])  

The Latest Research on Accountable Care Organizations
"[The author] would give ACOs another five or so years before drawing any strong conclusions about what they can do. Even a few years of generally positive results is insufficient to declare victory. It's reasonable to be optimistic, but cautiously so. A lot could still go wrong." (The Incidental Economist)  

An Overview of Cafeteria Plans (Code Section 125) (PDF)
"Section 125 of the Internal Revenue Code allows most employees to pay for certain benefits with pre-tax dollars, but complex and specific rules apply. This [article] reviews the Section 125 rules including: [1] Basic Legal Requirements; [2] Mid-year Changes; [3] Flexible Spending Accounts (FSAs); [and] [4] Non-Discrimination Requirements. Health care reform has now changed several aspects of the Section 125 rules." (McGraw Wentworth)  

California's Proposition 45 Would Offer Public a Say on Health Insurance Rates
"A year after the federal [ACA] took effect, California voters are now considering another major change to health care: a ballot measure that would give state officials the authority to veto health insurance rate increases for individual and small group plans.... Even some longtime supporters of more robust health insurance regulation have balked, saying that additional regulations could confuse consumers or drive insurers from the marketplace." (The New York Times; subscription may be required)  

[Opinion]

Testing the SHOP in Ohio: Not as 'Easy as Buying a Plane Ticket'
"Ohio is one of five states with early access to the Small Business Health Options Program (SHOP).... [The web site] asked us to begin entering information for each employee. We could either do that or download an excel document and populate it into the system.... The spreadsheet has 20 columns to complete for each employee. Each dependent has an additional 8 columns to complete. You must provide date of birth, social security number, date of hire, address, employee code, and a preferred method of contact for each employee and their dependents.... Without knowing the rates and benefits it doesn't make sense to waste productivity gathering all of the data. Instead we will wait until the insurance companies are allowed to quote the plans directly. When will that be? I'm not sure but I'll bet it won't be until after next Tuesday." (InsureBlog)  

[Opinion]

Why the Health Care System Should Stop Trying to Help Everyone Live Longer
"Atul Gawande's current best-seller, Being Mortal, has touched a nerve regarding our medical system's very poor handling of aging, life-altering illnesses, hospice, and palliative care. The book raises the question of why the U.S. health system prizes the length of a patient's life over the quality of that life in a person's final years." (The Washington Post; subscription may be required)  

Benefits in General; Executive Compensation

Employer Costs for Employee Compensation, September 2014
"[For private industry workers, the increase] in the cost of benefits was 2.3 percent for the 12-month period ending September 2014. In September 2013, the increase in the cost of benefits was 2.0 percent. Employer costs for health benefits increased 2.6 percent over the year. In September 2013 the increase was 2.7 percent." (U.S. Bureau of Labor Statistics [BLS])  

Text of Federal District Court Opinion: Sole Owner of Business Could Be Personally Liable for Multiemployer Plan Withdrawal Liability (PDF)
"A close review of the Seventh Circuit cases noted above indicates that a more helpful recitation of the rule would proceed as follows: Where an individual [1] owns the property on which a withdrawing employer conducts its operations, [2] leases the property to the withdrawing employer, and [3] owns the withdrawing employer, then that individual is personally liable for the payment of withdrawal liability incurred by the withdrawing employer. In sum, if an individual engages in a trade or business under common control with the withdrawing employer by leasing his property to the withdrawing employer, he is personally liable for payment of withdrawal liability." [Board of Trustees of the Automobile Mechanics' Local No. 701 Union And Industry Welfare Fund and Board of Trustees of the Automobile Mechanics' Local No. 701 Union And Industry Pension Fund v. Beland & Wiegers Enterprises, Inc., No. 13-CV-1611 (N.D. Ill. Oct. 29, 2014) (U.S. District Court for the Northern District of Illinois)  

ERISA 40th Anniversary Timeline
24 interactive slides containing historical photographs and hypertext links to source documents. (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])  

Press Releases

ACOPA Awards Fellow Designations to Exceptional Actuaries
ASPPA College of Pension Actuaries [ACOPA]

ASPPA Presents Richard A. Groszkiewicz with Distinguished Educator’s Award
ASPPA [American Society of Pension Professionals & Actuaries]

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