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The BenefitsLink Newsletter -
Welfare Plans Edition

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August 16, 2000

Y2K Benefit Changes Require Employers to Revise Their COBRA Forms and Procedures
Excerpt: "The regulations now provide that, if a COBRA premium payment is short by an 'insignificant amount,' then the employer cannot reject the premium. Instead, the employer is required to either treat the short payment as satisfaction in full or provide the participant at least 30 days to make up the difference." (Nixon Peabody LLP)

BenefitsLink Is Looking for a Q&A Column Author: COBRA Questions from Health Plan Participants
We have an active array of question-and-answer (Q&A) columns on BenefitsLink, but one topic that's been missing is COBRA compliance from the perspective of health plan participants and beneficiaries ... lots of folks ask about their rights under the health plan of their employer or former employer or a former spouse's employer. Are you interested? Click for more information. (BenefitsLink.com, Inc.)

State Law Claims Against TPA, Stop Loss Insurer Regarding ASA/Policy Language Not Preempted
Excerpt: "ERISA did not preempt state law claims against a third-party administrator (TPA) and stop-loss insurer regarding problems with claims processing, a federal district court in Indiana ruled. The court generally found that the claim processing dispute solely involved interpreting the administrative services agreement (ASA) or the stop-loss policy-- not the ERISA plan. Therefore, no ERISA issues were involved. The case is Analytical Surveys, Inc. v. Intercare Health Plans, Inc." (Thompson Publishing Group)

7th Cir.: Insurer Improperly Denied LTD Benefits To Disabled Employee
Excerpt: "The Seventh Circuit U.S. Court of Appeals has ruled that an insurance company improperly denied long term disability benefits to an employee who injured her back and subsequently was unable to perform the duties of her job. The ruling came in Postma v. Paul Revere Life Insurance Company." (Spencernet)

Court Rejects Administrator's Interpretation That Plan Only Covers In-Service Disabilities
Robert E. Williams v. International Paper Co. (6th Cir. 2000). Excerpt: "Participant is defined as 'any Eligible Employee who becomes covered by the Plan as provided in Article II and shall include any individual who has separated from service or ceased to be an Eligible Employee for whom there is still a liability under the Plan.'" (Corbel)

`Part-Timers Gain Status, Benefits
Excerpt: "The number of companies offering some benefits to part-time workers has been rising in recent years because of the tight labor market. But the number of companies that extend their entire benefits package-- not just health and dental coverage, paid time off, and paid vacation-- to part-timers is still small." (IndustryWeek Magazine)

Computer Age Takes A Bite Out of Traditional Midday Meal
Excerpt: "[I]n the halls of Bay Area dot-com businesses, stopping to eat is considered a time suck, a ritual for losers who simply don't have enough to do. Although people may go to restaurants on special occasions, the lunch business is fading. 'In the dot-com environment here in SOMA, lunch is irrelevant,' says Jennifer Griffin... When she and her colleagues get hungry, they don't go to a restaurant; they order in or go to the kitchen and feed on an endless stream of company-supplied snacks." (San Francisco Chronicle)

Key to Employee Retention: Job Satisfaction
Excerpt: "'It's what works in keeping key employees,' said [John E.] Nelson, who has 30 years in training and development. 'And it occurs in a high-energy, flexible work environment, where employees have a clear line of vision between their personal achievement and the bottom line.'" (Chicago Tribune)

It's Pay Plan, Not Perks, That Sales Workers Want
Excerpt: "What really sells sales workers on jobs is the compensation plan that determines what they have to do to make the most money. And some companies are tweaking these plans to satisfy the workers they have and to lure others to their shops, industry workers say." (Knight-Ridder / Tribune)

AMA Launches Drive for Passage of Patients' Rights Bill in Senate
Press release. Excerpt: "In a strong pre-election drive to secure final Senate passage of a real patientsí bill of rights, the American Medical Association today announced a national grassroots campaign to mobilize public support for the legislation." (American Medical Association)

Go Directly to Work: Lose Health Insurance (PDF)
Excerpt: "... until now there have been no studies of welfare reform's impact on the health coverage of parents.... Families USA gathered data on the insurance status of the low-income population and on parents' Medicaid enrollment ... [the study's conclusion is that] Medicaid enrollment of low-income parents is declining rapidly. As states implemented welfare reform over the past four years, they failed to ensure that parents moving from welfare to work retained needed health coverage." (Families USA)

(Following also appears in Retirement Plans Edition)

IFEBP Places Employee Benefit Plans Glossary Online
This 10th edition of the 220-page book also is available for ordering from IFEBP in convenient hardcopy for $32 (IFEBP Members $29). (International Foundation of Employee Benefit Plans)

Links to Articles and Resources on Domestic Partners Issues Are Now Categorized on BenefitsLink
Should an employer extend employee benefits to the "domestic partner" of an employee? Only to same-sex domestic partners? How many employers have done so already? BenefitsLink is now collecting and publishing links to articles about the employee benefits aspects of domestic partners. (BenefitsLink.com, Inc.)

Mother-and-Son Team Rely on Each Other in Building eBenefits
Excerpt: "Outsourcing human resource services has become a huge business. Dataquest estimates the market will grow from $900 million in 1999 to more than $12 billion by 2003 in the United States." (San Francisco Chronicle)

Bins v. Exxon Company, U.S.A.
Excerpt: "We must determine in this case the point at which an employer who administers a plan under [ERISA] has a duty to inform plan participants that it is considering a proposal to offer more generous retirement incentive benefits.... In the months before he retired, Bins unsuccessfully attempted to confirm rumors that EUSA was considering offering eligible employees a lump-sum retirement incentive under an existing welfare benefit plan covered by ERISA. Two weeks after Bins retired ..." (United States Court of Appeals for the Ninth Circuit)

Cases Highlight Investment Plan Options, Attorney Liability
Excerpt: "One recent court case involves a theme that has become increasingly familiar-- the charge by plan participants that plan sponsors violated their fiduciary responsibility by improperly investing plan assets in inappropriate funds. Another case concerns a new approach to determining liability for attorney's fees in cases brought against a plan sponsor." (Thompson Publishing Group)

Regulating Executive Pay: Using the Tax Code to Influence CEO Compensation
Link to a Working Paper available for downloading from the National Bureau of Economic Research. Excerpt: "This study explores corporate responses to 1993 legislation, implemented as section 162(m) of the Internal Revenue Code, that capped the corporate tax deductibility of top management compensation at $1 million per executive unless it qualified as substantially performance-based.'" (National Bureau of Economic Research Working Paper)

FLSA Amended to Exclude Some But Not All Stock Option Compensation from Overtime Pay Calculations
Excerpt: "President Clinton has signed into law the Worker Economic Opportunity Act which amends the Fair Labor Standards Act to clarify that an employer must exclude compensation attributable to a stock option, stock appreciation right or stock purchase under a "bona fide employee stock purchase program" from the calculation of overtime pay and also the calculation of whether the federal minimum wage has been paid for a non-exempt employee (i.e., an hourly employee)." (Cooley Godward LLP)

Job Openings Newly Posted or Reposted on EmployeeBenefitsJobs.com

Executive Benefits Administration Managerfor Leading Executive Benefits Firm
in CA
Group Managing Director, IAS Employee Educationfor Major Midwest Financial Services Institution
in OH
Retirement Administratorfor Delaware Investments
in PA
Defined Benefits Services Account Managerfor MassMutual
in MA
Plan Consultantfor Cascade Pension Services, LLC
in OR
Actuarial Analystfor Aon Consulting, Inc.
in MD, PA
Senior Actuaryfor Aon Consulting, Inc.
in DC, MD
Benefit Plan Administratorfor Aon Consulting, Inc.
in MD
Claims Auditor/Consultantfor Aon Consulting, Inc.
in MD
Team Managerfor Leading Executive Compensation & Benefits Firm
in CA, NY

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