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<< Older News  |  August 2, 2021

News

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Practical Takeaways on EBRI's Retiree Profile Research (PDF)
Employee Benefit Research Institute [EBRI] Link to more items from this source
Aug. 2, 2021

"In evaluating the retiree profiles developed by EBRI, ... the most salient drivers of retirement satisfaction and security appear to be guaranteed sources of income, low debt, a clear spend-down strategy, and employer-sponsored retirement help, including advisory services. "

Tags: Retirement Plan Design

IRS Takes Second Bite Into COBRA Subsidy Questions Under ARPA
Miller Johnson Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"IRS Notice 2021-46 provides helpful clarifications on the following topics: [1] AEIs may be eligible for the COBRA subsidy for extended coverage periods (e.g., disability extensions or second qualifying events), even if the AEI didn't elect extended coverage before April 1, 2021; [2] Eligibility for other health coverage that does not include vision or dental benefits terminates an AEI's eligibility for the COBRA subsidy for vision-only or dental-only coverage; and [3] Additional clarification on the entity that may claim the tax credit for the COBRA subsidy."

Tags: ARPA  •  COBRA

Duluth, Minnesota Amends Paid Sick and Safe Leave Ordinance
Littler Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"[E]ffective August 19, 2021 ... Employees will be able to use leave when they lose work hours when their place of employment closes for public health reasons ... If employers maintain an employee handbook, it will need to include a copy of the company's ESST policy ... Employers must either display or provide the city-created poster to employees or provide a company-created notice that advises employees of their rights under the ordinance."

Tags: FMLA and Other Leave  •  Local Regulation

California Legislative Update: Family Leave and Sick Pay
Ogletree Deakins Link to more items from this source
Aug. 2, 2021

"Two bills, currently pending in the Senate, seek to expand the scope of the California Family Rights Act (CFRA). The second bill also looks to expand sick pay."

Tags: FMLA and Other Leave  •  Local Regulation

Health Insurance Coverage Among Working-Age Adults with Disabilities: 2010-2018
Assistant Secretary for Planning and Evaluation [ASPE], U.S. Department of Health and Human Services [HHS] Link to more items from this source
Aug. 2, 2021

"From 2010-11 to 2017-18, the proportion of U.S. adults with disabilities who lacked health insurance coverage for a full year was nearly halved, falling by about 46% from 17% to 9%. There was also an increase of about 14% in the proportion of adults with disabilities who had continuous coverage, from about 71% to 81%. These improvements were concentrated immediately after 2014, when the largest ACA-driven insurance expansions first took effect."

Tags: Health Plan Policy

Use Value-Based Payment to Resolve the Debate About Telehealth Payment Parity
Health Affairs Blog Link to more items from this source
[Opinion]
Aug. 2, 2021

"Some argue that telehealth requires less clinical effort and fewer overhead costs than in-person care, undercutting the case for payment parity.... Those who support payment parity believe it would help clinicians adopt and maintain telehealth as a way to support health care access and patient experience. Arguments on both sides would be strengthened by more high-quality studies."

Tags: Health Plan Costs  •  Health Plan Design  •  Teleheath

Plan Cybersecurity Guidance: DOL Enforcement Warrants Plan Sponsor Action
Poyner Spruill LLP Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"Although the most detailed piece of the package -- the best practices summary -- is framed as applying to plan service providers (such as recordkeepers and administrators), enforcement actions already implemented suggest that these standards likely also apply to plan-related information maintained by the plan fiduciary.... [P]lan sponsors and fiduciaries should be aware that this cybersecurity guidance likely applies to all plans governed by ERISA, not just retirement plans."

Tags: Health Plan Administration  •  Retirement Plan Administration

PBGC Rules on Special Financial Assistance to Multiemployer Plans: Effect on Benefits, Contributions, Withdrawal Liability, and Plan Design
The Wagner Law Group Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"PBGC specified that withdrawal liability is to be determined using PBGC mass withdrawal assumptions to value vested benefits for the later of ten years or the date SFA and earnings on SFA are depleted. Mass withdrawal assumptions are based on annuity purchase prices and therefore result in a conservative valuation.... The Rule also requires PBGC approval of any settlement of withdrawal liability claims in excess of $50 million."

Tags: ARPA  •  Funding of DB Plans  •  Multiemployer Plans

DOL Clarifies Lifetime Income Disclosure Requirement
Groom Law Group Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"The FAQs clarify that plans can provide participants with multiple [lifetime income illustrations (LIIs)].... This clarification may be helpful for plans that want to deliver various LIIs that, for example, take future contributions or in-plan annuity options into account. However, DOL has not extended the SECURE Act's fiduciary safe harbor for LIIs to any LIIs other than those meeting the requirements of the IFR."

Tags: Retirement Plan Administration  •  SECURE Act

IRS Issues Additional ARPA COBRA Subsidy Guidance
TRI-AD Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"[In] Notice 2021-46, the IRS has indicated that all individuals who still have a right to enroll in COBRA and/or make COBRA payments between April 1, 2021–September 30, 2021, are eligible for the subsidy, unless eligible for other major group health coverage or Medicare. In other words, they don't need to be currently enrolled in COBRA and making payments. This may require employers to offer these AEIs COBRA coverage and the subsidy if the employer or plan administrator are notified by these individuals of such events."

Tags: ARPA  •  COBRA

Including Long-Term Part-Time Employees in 401(k) Plans
Definiti Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"[T]he SECURE Act changed the rules that permitted 401(k) plans to exclude individuals who worked less than 1,000 hours in the plan year.... [Unanswered questions include:] Can an equivalency method be used for counting service? How should a plan handle any missed deferral opportunities for [long-term part time (LTPT)] employees? Will LTPT employees be counted as 'participants' for purposes of the Form 5500? Will the LTPT rules apply to 'grandfathered' governmental plans? Will the LTPT rules apply to church 401(k) plans?"

Tags: 401(k) Plans  •  Retirement Plan Administration  •  SECURE Act

Ninth Circuit Affirmation of CalSavers Decision May Forecast State Auto-IRA Nightmare for Some Employers
Thompson Hine Link to more items from this source
Aug. 2, 2021

"The CalSavers decision clearly does not provide for a blanket exemption to other state programs and thus, ERISA preemption will likely continue to be considered on a program by program basis.... This patchwork of programs that vary from jurisdiction to jurisdiction will present compliance challenges that are not insignificant for multistate employers, particularly those with nontraditional workforces who historically have not been eligible to participate in an employer sponsored retirement savings plan." [Howard Jarvis Taxpayers Ass'n v. California Secure Choice Ret. Savings Program, No. 20-15591 (9th Cir. May 6, 2021)]

Tags: ERISA Preemption  •  Retirement Plan Design  •  Retirement Plan Policy

Revised Washington State Paid Family and Medical Leave Expands List of Covered Family Members
Jackson Lewis P.C. Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"[T]he term 'family member' ... has been expanded to include 'any individual who regularly resides in the employee's home or with whom the relationship creates an expectation that the employee care for the person, and that individual depends on the employee for care.' The term 'family member' does not include a person who simply resides in the same home with no expectation that the employee care for the individual."

Tags: FMLA and Other Leave  •  Local Regulation

Great-West Defendants Prevail in Appeal of Fee Challenge
PLANSPONSOR; free registration may be required Link to more items from this source
Aug. 2, 2021

"Much of the text of the appeals court ruling is spent recounting the factual background of the case, including discussion of many actions taken by Great-West defendants to review and reconsider the investment fees questioned by the plaintiffs. The ruling also considers in close detail the legal analysis of the district court, backing its conclusions time and again[.]" [Obeslo v. Great-West Life & Annuity Ins. Co., No. 20-1310 (10th Cir. Jul. 26, 2021)]

Tags: Fiduciary Duties  •  Retirement Plan Investment Costs

Should 401(k) Plans Permit Cryptocurrency on the Investment Menu?
Carol Buckmann, via RPA Convergence Link to more items from this source
Aug. 2, 2021

"Although the [DOL] has not come out with any guidance regarding cryptocurrencies, plan investment options must be appropriate for all participants, including less sophisticated ones. The DOL could determine that participants shouldn't be given an opportunity to gamble their retirement money and that cryptocurrencies shouldn't be a separate asset class on a plan's investment menu."

Tags: Retirement Plan Investments

Pittsburgh, Pennsylvania Enacts Another Emergency Paid Sick Leave Ordinance
Littler Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"626B was passed as a new law, but it is nearly identical to Pittsburgh's original Temporary COVID-19 Emergency Paid Sick Leave Ordinance (626A) that was in effect from December 8, 2020 through June 17, 2021. Though new 626B's text largely mirrors that of 626A, there are some important differences.... [It] appears 626B requires an entirely new bank of leave because it is a separate ordinance rather than an amendment to or extension of the original ordinance."

Tags: FMLA and Other Leave  •  Local Regulation

SSA OIG Report: Follow-Up on 2011 Audit of Old-Age, Survivors and Disability Insurance Benefits Affected by State and Local Pensions
Social Security Administration Office of the Inspector General [OIG] Link to more items from this source
Aug. 2, 2021

"In a 2011 audit, [OIG] estimated SSA overpaid approximately 24,900 beneficiaries about $623.8 million. These beneficiaries would receive approximately $869.9 million in additional overpayments over their lifetimes unless SSA corrected these payment errors.... [OIG] reviewed SSA's actions to implement the three recommendations in [the] 2011 audit and found that, although SSA made efforts, work still needs to be done. Two of the three recommendations involved systematic changes needed for SSA to effectively identify beneficiaries whose benefit must be adjusted because of WEP or GPO."

Tags: Social Security

Legislation Introduced to Encourage Retirement Product Innovation
Insured Retirement Institute [IRI] Link to more items from this source
Aug. 2, 2021

"A bill to lower barriers to innovative retirement income products by requiring the [SEC] to revise its rules regarding the development and offering of certain annuity products was introduced in the House of Representatives ... The Registration for Index Linked Annuities Act [HR 4865] directs the SEC to devise a new form for annuity issuers to use when filing registered index-linked annuities (RILAs)."

Tags: Retirement Plan Design  •  Retirement Plan Policy

Chicago Amends Paid Sick Leave Law
Society for Human Resource Management [SHRM]; membership may be required to view article Link to more items from this source
Aug. 2, 2021

"The Chicago City Council amended its Paid Sick Leave Ordinance (PSLO) to clarify and expand the bases to take paid leave ... [T]he paid sick leave amendments took effect on Aug. 1."

Tags: FMLA and Other Leave  •  Local Regulation

Recordings of Phone Calls Made for Quality Assurance Purposes Must Be Disclosed to ERISA Benefit Claimants
Hodgson Russ LLP Link to more items from this source
[Guidance Overview]
Aug. 2, 2021

"Plan administrators should work with their carriers or third party administrators to ensure that such recordings are retained for the relevant limitations period, and are disclosed upon request, even if the recordings were not relied upon in denying the claim."

Tags: Health Plan Administration  •  Retirement Plan Administration

Text of IRS Notice 2021-48: Guidance on Single-Employer Defined Benefit Pension Plan Funding Changes Under the American Rescue Plan Act of 2021 (PDF)
Internal Revenue Service [IRS] Link to more items from this source
[Official Guidance]
July 30, 2021

18 pages. Topics addressed include:

  • Application of Section 430(c)(8) of the Code and Section 9706 of the ARP
    • Effect of Section 9706 of the ARP on interest adjustments with respect to certain contributions made pursuant to Section 3608(a) of the CARES Act
    • Applying the ARP segment rates to statutory hybrid plan interest credits
  • Manner and Timing of Making Elections under the ARP
  • Rules for Elections under Section 430(f) of the Code as a Result of the ARP and Flexibility to Redesignate Contributions Between Plan Years
    • Election to add to a prefunding balance
    • Revocation of an election to use a prefunding balance or funding standard carryover balance
    • Revocation of an election to reduce a prefunding balance or funding standard carryover balance
    • Redesignation of plan year for contributions
  • Changes in AFTAP under Section 436 of the Code as a Result of the ARP
    • Prospective application of change in benefit restrictions reflecting amendments made by the ARP
    • Retroactive application of change in benefit restrictions reflecting changes under the ARP
    • Rules with respect to elections under Section 3608(b) of the CARES Act
    • Recharacterization of contributions made to avoid benefit limitations pursuant to Section 436 of the Code
    • Corrections
  • Reporting Requirements for Changes for the 2019 Plan Year
  • Reporting Requirements for Changes for the 2020 Plan Year

Tags: ARPA  •  Funding of DB Plans

CMS: Part D Premiums Projected to Increase Nearly 5% in 2022
FierceHealthcare Link to more items from this source
July 30, 2021

"The average Part D premium is projected to increase by nearly 5% from $31.47 to $33 in 2022.... The announcement comes amid several potential major changes to Medicare being debated in Congress."

Tags: Medicare  •  Prescription Drug Costs

DOL Clarifies Timing of Lifetime Income Disclosures in Benefit Statements
Kilpatrick Townsend Link to more items from this source
[Guidance Overview]
July 30, 2021

"Participant directed plans ... generally must furnish lifetime income disclosures by the benefit statement for the second quarter of 2022 ... For plans that do not allow for participant-directed investment, lifetime income disclosures must be included in the benefit statement for the first plan year ending on or after September 19, 2021, which ... for calendar year plans ... must be furnished no later than October 15, 2022."

Tags: Retirement Plan Administration

DOL Provides FAQs on Interim Final Rule on Lifetime Income Disclosures for DC Plans
Voya Link to more items from this source
[Guidance Overview]
July 30, 2021

"The DOL acknowledges that 'many retirement plans have been providing various types of illustrations for several years.' The DOL notes that the ages in the interim final rule must be used for lifetime income disclosures, but that plan administrators may provide participants with additional lifetime income illustrations[.]"

Tags: Retirement Plan Administration

IRS Giveth New Options for Voluntary Correction But Also Taketh Away
Employee Benefits Law Group Link to more items from this source
[Guidance Overview]
July 30, 2021

"If you are a plan sponsor or you are working with a plan sponsor that has a qualification failure that does not neatly fit within the safe harbor guidelines of EPCRS and you are not sure that you want to reveal your identity to the IRS in a VCP application, you should act fast and file an anonymous VCP application as soon as possible. The last day to file such an application is December 31st[.]"

Tags: Retirement Plan Administration


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