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<< Older News Items  |  December 8, 2019

News Items

Editor's Note: This page is an archive of news items that appear in our daily email newsletters. To automatically receive the latest news items -- plus links to the latest jobs, press releases, webcasts and events -- subscribe to our daily email newsletters.

What You Don't Know, Can Hurt You: ERISA's Statute of Limitations Conundrum (PDF)
Jose Jara and Anthony Fassano of Archer & Greiner P.C., via Tax Management Compensation Planning Journal
Dec. 6, 2019

"Is it actual knowledge of the underlying facts supporting a claim? Or is it not only the knowledge of these underlying facts, but in addition the understanding that there is a legally viable claim? Furthermore, the Court may rule on what responsibilities a plan participant has in terms of reading and understanding mandated disclosures." [Sulyma v. Intel Corp. Investment Policy Comm., No. 17-15864 (9th Cir. Nov. 28, 2018; cert. pet. granted June 10, 2019; oral arg. Dec. 4, 2019)]

Text of White Paper from HHS: Risk Adjustment Data Validation (HHS-RADV)
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]
Dec. 6, 2019

120 pages. "HHS is considering potential modifications to four specific aspects of the HHS-RADV program: [1] enrollee sampling; [2] outlier detection; [3] the error rate calculation and [4] the application of HHS-RADV results ... The options in this white paper were developed based on HHS's ongoing internal analysis of potential refinements to the HHS-RADV program for future benefit years, as well as comments received on HHS-RADV through notice-and-comment rulemaking and through listening sessions with stakeholders. [HHS is] seeking comments on the options outlined in this white paper to help inform potential future rulemaking in these areas."

IRS Continues ACA Reporting Relief But with a Twist
Miller Johnson
[Guidance Overview]
Dec. 6, 2019

"Notice 2019-63 generally does not extend this relief to large self-funded employers, except for Forms 1095-C that are prepared on behalf of individuals who are not full-time employees for the entire 2019 calendar year.... Examples of where this relief may extend to Forms 1095-C are: [1] former employees who terminated employment before 2019 but were enrolled in the self-funded plan under COBRA or retiree coverage; and [2] employees who were part-time during all of 2019, but were enrolled in the self-funded plan because the plan sponsor extended eligibility for the self-funded plan to part-time employees."

Text of PBGC Final Regs: Allocation of Assets in Single-Employer Plans; Valuation of Benefits and Assets; Expected Retirement Age
Pension Benefit Guaranty Corporation [PBGC]
[Official Guidance]
Dec. 6, 2019

"This rule amends the [PBGC's] regulation on Allocation of Assets in Single-Employer Plans by substituting a new table for determining expected retirement ages for participants in pension plans undergoing distress or involuntary termination with valuation dates falling in 2020. This table is needed to compute the value of early retirement benefits and, thus, the total value of benefits under a plan.... This rule is effective January 1, 2020."

Who Owns a 401(k) Participant's Personal Information?
The Retirement Plan Blog
Dec. 6, 2019

"At least one district court has concluded that the personal information of retirement plan participants is not a plan asset because it is not 'property the plan could sell or lease' ... But there is a thriving commercial market for personal information and it is bought and sold for marketing purposes every day (think Google here). So, should retirement plan fiduciaries act to protect the personal information of plan participants while the courts sort this out?"

Text of Draft 2019 IRS Form 8963: Report of Health Insurance Provider Information (PDF)
Internal Revenue Service [IRS]
[Official Guidance]
Dec. 6, 2019

Dec. 5, 2019. "On the first line, list information for the single-person covered entity or designated entity, whichever applies. Next, for a controlled group, separately list information for every person who is a controlled group member at the end of the day on December 31, 2019, and who would qualify as a covered entity in 2020 if it were a single-person covered entity (see instructions)."

No Uptick in 401(k) Hardship Withdrawals Seen in Wake of Final Regs
Pensions & Investments
Dec. 6, 2019

"Of the 145 plan sponsors surveyed, 64.6% adopted the new hardship provisions, and of those, 72.6% reported no changes in the level of hardship withdrawals in 2019 with only 17.8% reporting an uptick[.]"

Text of Draft 2019 IRS Form 1095-B: Health Coverage (PDF)
Internal Revenue Service [IRS]
[Official Guidance]
Dec. 6, 2019

Dec. 5, 2019. "This Form 1095-B provides information needed to report on your income tax return that the individuals in your tax family (yourself, spouse, and dependents) had qualifying health coverage (referred to as 'minimum essential coverage') for some or all months during the year. Individuals who don't have minimum essential coverage and don't qualify for an exemption from this requirement may be liable for the individual shared responsibility payment."

IRS Extends Deadline for 2019 Employer ACA Disclosures
Buck
[Guidance Overview]
Dec. 6, 2019

"While the date for filing with the IRS was not extended, filers can obtain an automatic 30-day extension by submitting Form 8809 by the due date for the ACA information returns. Form 8809 may be submitted on paper or electronically, and no explanation for the extension is required....[T]he IRS deadlines (and extensions) for filing and furnishing ACA forms may not apply to the state reporting requirements."

Severstal Wheeling Case Provides Guidance for Retirement Committee Members
Epstein Becker Green
Dec. 6, 2019

"The guidance from the WPN court is essentially a roadmap that can assist an Appointing Fiduciary in satisfying its duty to monitor the investment fiduciaries that it has appointed." [Scalia v. WPN Corp., Ronald LaBow, Severstal Wheeling Retirement Committee, et al., No. 14-1494 (W.D. Pa. Sept. 30, 2019)]

First Circuit Overturns the Sun Capital, But Risks Remain for Private Equity
McDermott Will & Emery
Dec. 6, 2019

"[P]rivate equity funds that do have a controlling interest in a portfolio company with defined benefit plan liabilities or multiemployer plan withdrawal liability should not rely on the notion that such funds are not engaged in a trade or business to insulate them from joint and several liability." [Sun Capital Partners III, LP v. New England Teamsters & Trucking Industry Pension Fund, Nos. 16-1376, 19-1002 (1st Cir. Nov. 22, 2019)]

The Role of HR Technology in Controlling the Cost of Health Plans
HR Daily Advisor
Dec. 6, 2019

"Tools that used to be optional in the open enrollment process are quickly becoming mandatory. These include simple Web integrations like plan documents, [ACA] disclosures, and provider directories, as well as more detailed analyses like plan comparison and cost projection tools. A simple 'pop-up' glossary of terms is almost essential now if an employer is including innovative new plan options in its healthcare choices. Here are comparative examples."

CMS Publishes 2018 National Healthcare Expenditures
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]
Dec. 6, 2019

"Total national healthcare spending in 2018 grew 4.6 percent ... [T]he share of the economy devoted to health spending decreased from 17.9 percent in 2017 to 17.7 percent in 2018.... ... Private health insurance spending (34 percent of total health care spending) increased 5.8 percent to $1.2 trillion in 2018, which was faster than the 4.9 percent growth in 2017.... Out-of-pocket spending grew 2.8 percent to $375.6 billion in 2018, which was faster than the 2.2 percent growth in 2017."

Senate Republicans Release Proposal for Multiemployer Pension Reform
Groom Law Group
Dec. 6, 2019

"In addition to addressing failing plans, the Proposal contains a series of measures that are intended to ensure that additional crises do not occur in the future. The scope of these measures is extremely broad, and they would affect nearly all aspects of multiemployer plan funding, administration, and governance.... [T]he Proposal is likely to have a significant influence on the process going forward."

Prescription Drug Prices Down Slightly Last Year
Associated Press
Dec. 6, 2019

"Prices for prescription drugs edged down by 1% last year, a rare result driven by declines for generics and slow, low growth in the cost of brand-name medications ... The price drop was for retail pharmacy prescriptions, not medications administered in hospitals or doctor's offices.... [T]he last time retail prescription drug prices declined was in 1973, when they went down by 0.2%."

Health Savings Account Balances, Contributions, Distributions, and Other Vital Statistics, 2018
Employee Benefit Research Institute [EBRI]
Dec. 6, 2019

"Enrollment in high-deductible, HSA-eligible health plans was estimated to be between 23 and 36.8 million policyholders and their dependents and covered nearly 3 in 10 employees in 2018.... Two-thirds of accountholders ended 2018 with positive net contributions, meaning annual contributions were higher than annual distributions.... Only 14 percent of accountholders contributed the fully allowable annual amount."

Law Firm's Mandatory Age 70 Retirement Policy Was Enforceable, Says Eighth Circuit
Hinshaw & Culbertson LLP
Dec. 6, 2019

"In 2003, the United States Supreme Court established a six-factor test ... to determine whether an individual is likely an owner or an employee.... Not all partners in every firm are created equally, and firms with multitiered partnership levels should tread carefully. Most non-equity partners -- and even some equity partners, those with little or no management authority, and few voting rights -- potentially could be considered employees under the ADEA." [Von Kaenel v. Armstrong Teasdale, LLP, No. 18-2850 (8th Cir. Dec. 3, 2019)]

Provider Charges Relative to Medicare Rates, 2012-2017
The Brookings Institution
Dec. 6, 2019

"[S]pecialties possessing the ability to surprise bill out-of-network patients -- emergency and ancillary physicians -- have charged notably higher amounts relative to Medicare rates than other specialties ... [A]verage charges have been growing especially fast relative to Medicare payment rates in the two specialties most commonly associated with surprise billing -- emergency medicine and anesthesiology -- at 6.7 and 4.4 percent annually on average from 2012-2017[.]"

My Day at the Supreme Court: Thoughts on the Intel Oral Argument
Emily Gilbert, Pension Rights Center
[Opinion]
Dec. 6, 2019

"Many of the justices on the Court seemed to think that just sending a link in an email is not enough. Justice Brett Kavanaugh said, 'many people don't read them,' and Justice Ruth Bader Ginsberg even admitted to not reading every document she receives about her own investments.... Many of the questions ... highlighted the [Pension Rights Center's concerns] with this proposed 'notice and access' rule that would allow plans to simply send individuals emails telling them that they could find critical retirement plan information on a website."

Employers, Insurers, Unions Urge Full Repeal of Cadillac Tax
Modern Healthcare Online; free registration may be required
Dec. 6, 2019

"More than 1,000 employers, insurers, unions, and other organizations ... urged Senate leaders to scrap a controversial tax on expensive employer-sponsored health plans that's set to go into effect in 2022.... [T]he organizations warned that the failure to repeal the so-called 'Cadillac tax' on certain employer plans would lead workers to pay more for medical treatment and face narrower provider networks."

There's Nothing Wrong With Health Care That Less Money Couldn't Fix
Bruce Pyenson and Marjorie Schulman, in Health Affairs
[Opinion]
Dec. 6, 2019

"[1] Expect deflation for health care prices and spending.... [2] Expect drug prices to deflate. ... [3] Reassess and minimize the cost of middlemen. ... [4] Accept that utilization review and other cost-management tools are good and necessary.... [5] Move further away from fee-for-service. ... [6] Prioritize primary care. ... [7] Make cost reductions an integral part of consolidation. ... [8] Implement a Cadillac (excise) tax on lavish benefits. "

Managing Specialty Medication Costs
Frenkel Benefits
[Opinion]
Dec. 6, 2019

"Setting administration and quantity limits are two effective cost-containment measures, but more effective strategies are needed.... [E]stablishing government-led price controls might be a good compromise; however, care should be taken so that these controls don't mitigate too greatly the profit potential that fosters innovation."

Editor's Pick Default Electronic Delivery Works: Evidence of Improved Participant Outcomes from Electronic Delivery of Retirement Plan Documents (PDF)
The SPARK Institute
[Opinion]
Dec. 5, 2019

50 pages. "Estimates indicate that plan participants could increase their final account balance by 63 percent with modest increases in their deferral rate which provider data indicates can be accomplished with electronic communication nudges and engagement with online tools.... [S]witching to an electronic delivery default would produce $250 to $450 million in aggregate savings annually that would accrue directly to individual retirement plan participants."

Nevada's 'Leave for Any Purpose' Law Clarified
CBIZ
Dec. 5, 2019

"[E]ligible employees in Nevada are entitled to accrue 0.01923 hours of paid leave for each hour worked, up to 40 hours per benefit year that can be used for 'any purpose'. The law takes effect on January 1, 2020. On October 4, 2019, the Nevada Labor Commissioner issued an advisory opinion ... to clarify certain aspects of this law. Of particular note, this guidance addresses how to determine employer size and the requirement to include information about the leave benefit in the employer's workplace policies."

Court Questions Insurer Behavioral Health Treatment Guidelines
DeBofsky Sherman Casciari Reynolds P.C.
Dec. 5, 2019

"The plaintiff argued that care criteria developed by the American Psychiatric Association, or APA, were more consistent with accepted standards of medical care than the United Behavioral Health guidelines, but the insurance company disagreed. Although the court concluded there was nothing improper about the development of treatment guidelines by insurance companies, the court began by addressing a significant problem with the defendant's use of the United Behavioral Health, or UBH, guidelines[.]" [S.B. v. Oxford Health Insurance, Inc., No. 17-1485 (D. Conn. Nov. 5, 2019)]


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