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73% of CBO's 'Coverage Losses' Are in Fact Individual Choices After Repeal of ACA Mandate
Avik Roy, in National Review
[Opinion]
July 25, 2017
"Nearly three-fourths of the difference in coverage between Obamacare and the various GOP plans derives from a single feature of the Republican bills: their repeal of Obamacare's individual mandate. But the CBO has never published a year-by-year breakout of the impact of the individual mandate on its coverage estimates.... [Of] the 22 million fewer people who will have health insurance in 2026 under the Senate bill, 16 million will voluntarily drop out of the market because they will no longer face a financial penalty for doing so: 73 percent of the total."
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Secure Choice 2.0: States Blazing a Path to Retirement Security for All (PDF)
National Conference on Public Employee Retirement Systems [NCPERS]
[Opinion]
July 25, 2017
36 pages. "Secure Choice is a direct outgrowth of persistent and converging trends that are reshaping the retirement landscape -- trends that include the diminution of traditional defined-benefit pension plans and the failed promise, for many Americans, of the much-vaunted 401(k) plan. This paper revisits these and other forces that have given rise to a wave of state initiatives to help Americans retire with dignity. It examines what has happened since the earlier white paper was issued, takes stock of developments at the state level, and looks at the challenges ahead."
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Text of GASB Proposed Implementation Guide: Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions
Governmental Accounting Standards Board [GASB]
[Official Guidance]
July 25, 2017
281 pages. "The objective of this Implementation Guide is to provide guidance that clarifies, explains, or elaborates on the requirements of Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, as amended, and Statement No. 74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, as amended. Questions and answers in this Implementation Guide address issues related to accounting and financial reporting for postemployment benefits other than pensions and for plans that are used to administer those benefits.... The requirements of this Implementation Guide apply to the financial statements of all state and local governments." [June 28, 2017; comments due to GASB by Sept. 25, 2017.].
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Text of PBGC Request for Information: Regulatory Planning and Review of Existing Regulations
Pension Benefit Guaranty Corporation [PBGC]
[Official Guidance]
July 25, 2017
"With an eye toward the Fall iteration of the semi-annual regulatory agenda, PBGC is requesting information, suggestions, and comment from the public -- including from plan sponsors, participants, practitioners, organizations representing retirees and plan participants, and other parties participating in or affected by PBGC's programs -- on regulatory and deregulatory actions PBGC should take. To facilitate this request for information, PBGC developed [13] questions ... the answers to which will help determine whether there are gaps in regulatory guidance where the public believes rulemaking would be beneficial, and help PBGC evaluate the continued effectiveness and usefulness of existing regulations."
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Text of IRS Final Regs: Health Insurance Premium Tax Credit
Internal Revenue Service [IRS]
[Official Guidance]
July 25, 2017
44 pages. "These regulations affect individuals who enroll in qualified health plans through Affordable Insurance Exchanges ... and claim the premium tax credit and Exchanges that make qualified health plans available to individuals.... After consideration of all the comments, the proposed regulations are adopted by this Treasury decision, with one technical correction that was not identified in the comments."
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Disability Plan Can't Offset Pension Benefits Rolled Into IRA
Thompson Coburn
July 25, 2017
"The Verizon SPD warned that certain benefits offset long-term disability benefits, including 'pension plan benefits from a Verizon pension plan if you elect to receive them.' The case turned on the phrase 'elect to receive.' ... [T]he 5th Circuit held that because the pension benefits were rolled over into an IRA, [the participant] did not 'receive' them. Thus, MetLife could not offset those pension benefits." [Thomason v. Metro. Life Ins. Co., No. 16-10634 (5th Cir. July 18, 2017; unpub.)]
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Guide to Retirement Plan Fees and Expenses
Multnomah Group; free registration required
July 25, 2017
11 pages. "[R]etirement plan fees can be classified into three main categories: [1] Asset-based fees and expenses are calculated as a percentage of plan assets and can be based on a portion or all assets of the Plan. [2] Participant-based fees and expenses are calculated based on the number of participants in the Plan, or eligible for the Plan. [3] Itemized service fees and expenses are typically applied as a fixed charge for a specific service provided to the Plan or a specific participant."
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Father of the 401(k) Designs Cheaper Retirement Plan
The Gazette
July 25, 2017
"Employees covered by small-business retirement plans typically pay between 1.5 percent and 2.75 percent annually in fees -- many of which are hidden and hard to understand.... [Ted Benna] has drawn up three new retirement-savings models that he contends offer the same benefits as a traditional 401(k). One is best suited for married employees with less than $100,000 of adjusted gross income and single employees with less than $62,000 of adjusted gross income. Another avoids the payroll taxes applicable to employer contributions. The third model allows employees to sock away pretax contributions of up to $12,500 under age 50 and $15,500 over age 50, compared with only $5,500 and $6,500 for some other models."
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2017 Defined Contribution Plan Sponsor Survey Findings
J.P. Morgan Asset Management
July 25, 2017
"A shift is taking place among plan sponsors in their view point on driving participant decisions. Now, more say they focus on proactively placing participants on a solid saving and investing path (vs. having participants make their own choices).... Despite many positive trends identified in this year's survey, one measure remains unchanged from 2015 -- many plan sponsors are not aware of their fiduciary status."
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Switching from a SEP to a 401(k)
Retirement Management Services
July 25, 2017
"While a SEP may be the perfect plan type for some situations, many employers who start with a SEP later realize that a 401(k) plan may actually help the owners better meet their objective of maximizing contributions to themselves at a lower contribution obligation for the employees.... A SEP may be terminated at any time and all funding can stop once the plan is terminated.... No notice has to be provided to the IRS about the SEP termination. Employees may take a distribution from the SEP or may roll their SEP account into the new 401(k) plan or into an IRA."
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Premiums Are the Big Factor in Health Plan Enrollment
Wolters Kluwer Law & Business
July 25, 2017
"After eliminating employee premiums for all coverage tiers, HSA-eligible health plan enrollment increased from 4 percent to 25 percent among individuals with employee-only coverage and from 2 percent to 31 percent among individuals with family coverage.... Offering coverage with no payroll deduction attracted individual enrollees who were marginally healthier than those who would have enrolled without this financial incentive in place, therefore not mitigating adverse selection as anticipated."
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The Company Behind Many Surprise Emergency Room Bills
The New York Times; subscription may be required
July 25, 2017
"Early last year, executives at a small hospital ... started using a company called EmCare to staff and run their emergency room.... Although the hospital had negotiated rates for its fees with many major health insurers, the EmCare physicians were not part of those networks.... For a patient needing care with the highest-level billing code, the hospital's previous physicians had been charging $467; EmCare's charged $1,649.... Newport's experience with EmCare, now one of the nation's largest physician-staffing companies for emergency rooms, is part of a pattern."
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Value of Advisors Underscored by Annuity Program Pilot
Advisor News
July 25, 2017
"Early responses to a new direct-to-consumer (D2C) annuity pilot program in Arizona reveal that buyers want to talk to someone -- or something -- before committing to a long-term retirement investment. The early findings in Nationwide's Guarantees Retirement Income program raise new questions for insurance companies serious about expanding through the growing D2C channel to reach middle-income consumers directly online."
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ACA Has Little Impact on Reducing ER Visits
HealthLeaders Media
July 25, 2017
"Emergency department visits in Maryland fell by 1% statewide in the months after Medicaid expanded. The number of Medicaid ED visits increased 6%, with a corresponding 6% drop in the number of uninsured emergency department visits."
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Investment Advice: How to Tell If Yours Is Good
Lawton Retirement Plan Consultants
July 25, 2017
"It is not necessary for plan sponsors to offer the best performing funds in their 401k plans. Rather, you should be more concerned that the process used to select and monitor the investment options offered is compliant and sound.... [Here] are ways you can tell if you are receiving good investment advice. [1] It is coming from a fiduciary ... [2] It includes discussion of 404(c) compliance and QDIAs ... [3] It is comprehensive ... [4] It demonstrates a sound process ... [5] [It] fits your culture ... [6] It includes proper monitoring."
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Public Pensions Are Under Attack in Iowa
National Public Pension Coalition
[Opinion]
July 25, 2017
"Each year IPERS pumps $1.8 billion into the Iowa economy through modest benefits that average $16,000 annually. This is economic activity that should not be underestimated in a small, mostly rural state like Iowa. As Iowa's population continues to shift from rural areas to larger cities, those small towns will find that they rely on the spending of pension benefits by retirees to stimulate local economies. Republican political leaders in Iowa appear to be laying the groundwork to attack and possibly eliminate IPERS."
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Cost-Sharing Reductions: What Are They and Why Do They Need to Be Funded? (PDF)
American Academy of Actuaries
July 25, 2017
"Decisions not to pay the reimbursements or even uncertainty about the reimbursements could result in 2018 premium increases averaging nearly 20 percent for silver plans, over and above premium increases due to medical inflation and other factors.... Although those who receive premium subsidies would be insulated from the full increase in premiums, nonsubsidized enrollees would face the full increase, potentially reducing their enrollment, increasing the uninsured population, and deteriorating the risk pool."
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'Small Business Health Plans' Undermine State Authority
The Commonwealth Fund
[Opinion]
July 25, 2017
"States currently have a wide range of approaches to regulating health insurance. Some have enacted numerous consumer protections, others are more hands-off. Because insurers will most likely gravitate to states with the least regulation, SBHPs would undermine states' autonomy to determine the type of consumer protections and level of insurance oversight that is appropriate for their residents."
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Treasury Department Gives Thumbs Up to Second Pension Rescue
Bloomberg BNA
July 24, 2017
"The Furniture Workers fund's proposal is the first under the MPRA to have its plan partition request get conditional approval from the federal Pension Benefit Guaranty Corporation, which guarantees a minimum benefit to plan participants. If the partition is approved as part of a vote by plan members, the plan would be divided into two plans -- the original plan and a successor plan -- with the PBGC providing financial assistance to the successor plan."
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PBGC's Early Warning Program: A Work in 'Progress'?
Morgan Lewis
July 24, 2017
"The PBGC ... posted FAQs on its website in May assuring plan sponsors that [Early Warning Program] review would not be triggered absent a transaction. A mere change in a plan sponsor's credit quality, for example, would not be sufficient. The PBGC also confirmed that its screening criteria ($50 million or more underfunding, or 5,000 or more participants -- each on an aggregate controlled group basis) had not changed."
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