GBurns

Don Why then do you reference 501(m) etc in discussions about VEBAs and now try to claim that you never said that it applies to VEBAs? Outdated etc material includes, and definitely not limited to, 1985 and 1988 CPE texts etc.

Probably the better question should be, Why would the rules not apply? Regardless of whether this is a DBRA plan or not, it still is a 401(k) plan isn't it ? So it seems, to me, that you should be the one with the onus to show that some other rule applies, and not the auditor. What rules have you been following?

Lori There is not enough info available to go beyond what Bird is suggesting. What should be done, rather than hypothetical speculation, is to have a few agents, who have experience etc, to run some actual illustrations. Do not forget to take into account any tax consequences of policy transfer or change.

The term is almost meaningless and could be applied to many variants of plans that use employer paid premiums etc. Is there any further info?

The issue is, as per the OP: "When a health insurance company contracts to provide health benefits to employees through an employer's VEBA is the insurance company contracting with the VEBA or the employer?" That is the issue. The contracting parties. The side issue is where did the IRS say what you claim?

Unfortunately, I was never able to find such a website, but I last looked way back in 2004. Someone might have created one since. It is also possible than a good small group agent might have a list that was prepared by one of the providers of a national program. In 2002 Conseco had such a list.

You have not answered the questions. In my opinion you have misinterpreted the relevance of GCM 39817 to the issues at hand. But worst of all, you excerpt bits and pieces then paste them together in a misleading manner, apparently trying to create some sort of authority or credible statement to support your interpretation.

If an employee gets reimbursed for the premium paid, Did the employee really pay the premium or is it that the employee advanced the premium for the employer? In the scenario where the employee gets reimbursed, the employee has no expense that could be considered for tax deductibility but the employer does have a deductable expense. Logic and common sense tells me that it is the entity with the expense and tax deduction whose rules govern. Many states have similarly worded regulations usually under either their Small Group Health Plan or List Billing regulations or both. I think that NJ and a few others also have it in their Income Tax regulations regarding exclusions from income.

I can't help with the TAM and I have never seen such numbering for the IRM.

Don The first obvious question pertains to: "This is because, according to the IRS, if a VEBA provides similar policies to those of commercial insurers, it would be unfair competition." Where did the IRS say this? A second question is Which community and what "community need" would a VEBA satisfy?

Don Maybe some hypothetical figures etc might help us to understand how "Benefits vary in direct proportion to contributions made, less claims incurred." would work.

A basic reason for VEBAs is to try and assure that funds are available. What recourse is available in the event of funds not being available depends on the facts and circumstances of each case. In any case, What does this have to do with the issue?

I am not clear on the OP. What is this "Section 105 Health Plan"? Is it a stand alone MERP or is it an FSA? How is it funded? Is the participant covered under the spouse's coverage ? What is the participant a participant of ? What also puzzles me is that the OP refers to "spouse's employer's plan" yet the premiums are paid "after-tax". I do not recal ever seeing an employer plan with after tax premiums.

Whether in a fully insured or in a self-funded there are 2 different entities, a VEBA funding arrangement and a health /medical plan. In a fully insured arrangement, the health plan contracts with an insurance company for the providng of claims payment and administrative services etc. The VEBA funds the premiums. In a self-funded arrangement, the health plan contracts with a third party for claims payment and administrative services etc. The VEBA funds the expenses.

SailorFred From what I read on the State website, it was not clear whether or not employers with self-funded plans are covered, but it made it seem possible. It could be that since most self-funded plans are not truly or fully self-funded but are in reality partially self-funded with stop-loss insurance coverage, there could be regulatory authority as a result of the insurance (stop-loss) component. But this is best explained by the State. It seems that you need to call the State to find out if Google is covered under CalCOBRA and why. If they are covered then you need convey that to Google and then file a cmplaint with the State if coverage is not given. Make sure you have everything in writing, in case you do have to file.

What you describe seems to be the same as what used to be called ZEBRAs (zero balance reimbursement accounts) which were outlawed around 1984. You might want to Google "zero balance cafeteria plans" to get some other comments.

Remember that getting the expenses reimbursed is not the end of the issue. When the expenses are reimbursed, the check will most likely be in the name of the FSA participant, now deceased. The "executor" will have to have either prepared a way of cashing the check or have an acount in which to deposit the check drawn to the deceased person.

I thought of some replies, but none were suitable for this Board.

While it could be indigestion, it most likely is caused by paranoia.

"seem" ?

Ric's suggestion regarding the Dr reporting to the employer raises another issue fror me, privacy laws. While the Dr would not be releasinng PHI, it might be that he would be releasing and discussing protected financial information, in that he would be discussing the patient's account, debt and payment practice/payment history. This should run foul of FDCPA, FCRA and other financial privacy laws.

The end result is that it is no business of either the employer or the plan. It could be credited back to the debit card, but I do not recall them having that feature. Even if it did, What happens if the participants objects or the card is needed but the participant refuses to give it? The Dr could issue a 1099 but this is doubtful since most companies only issue a 1099 for services rendered by individuals. But if one is issued, then it would have to reported as potentially taxable income (not necessarily earned income). If no 1099, as LRDG suggested, it should (must) be reported. But, What happens if it is not? Not much in my experience. The person would have to be selected for audit which is a long shot anyhow. If selected, the audit might be for some specific other item and this issue is not involved. But the audit could be broad spectrum. In that case, this item would have to be noticed, which is possible. If it is noticed, it could be taxed and it could have penalties for under reporting. But the tax liability depends on the overall tax report and we do not know what exemptions, deductions, losses etc that are part of this person's tax return. So even if found to be taxable income, there might be no taxes dues anyhow. So, I guess it comes down to a personal judgement call based on looking at the overall picture and bearing in mind the person's medical necessity.

Aside from "employer contribution" issues, as far as I recall, Flex One and other such voluntary programs require employer endorsement otherwise How would the enrollers get access to the premises, to the employees while at work on company time, and get the necessary payroll slot etc through which to make the deductions ? I also recall that Flex One (like others) require some sort of exclusivity for a specified period. If any sales rep of any company could sell the products to an employee, who could then just notify the Payroll Dept to make a salary reduction or deduction for the premium, that would be truly voluntary and have no employer involvement that could be applicable. To do a voluntary program otherwise requires more employer involvement, some restrictions and endorsement/selection of some sort.

You can find out about "full" cafeteria plans, including those using a Benefits Credits design etc by looking at the Benefits section of the website of most large public entities in almost any state. I am curious about your use of your union reps. Why would union reps, per se, be able to help you any more than you probably could help yourself, especially since you know best exactly what you are looking for?

Don That is a relatively short list and there are some who seemed to have filed "just in case", "not sure but better safe than sorry" or some other similar purpose, thereby greatly inflating the number. Also a large number seem inactive or never used. You still did not say which states have or are filing for waivers as you claimed. Why does a VEBA provide "pooling", facilitate " creative funding" and "creative plan design" any more than a taxable welfare benefit trust or anything else?