BenefitsLink Health & Welfare Plans Newsletter for August 20, 2001

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The BenefitsLink Newsletter -
Welfare Plans Edition

August 20, 2001 - 6,189 subscribers

Today's sponsor: ERISA Compliance for Health & Welfare Plans, by EBIA (click)

(Please help us continue to provide this valuable newsletter at no charge to you -- our sponsors pay our way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)

   ERISA Compliance for Health & Welfare Plans is an
authoritative resource for employers, administrators and
advisors.  Written by leading employee benefits
attorneys, this manual has all the information you need
to bring your welfare benefit plans into compliance with
ERISA.   Click on the link or banner above to learn more about this
valuable treatise. Always kept current through periodic
updates!

Trend: the Next Trillion-Dollar Opportunity-- Healthcare and Financial Services Convergence
Excerpt: "A revolution in how companies provide health-care benefits is poised to crack open a $1 trillion-dollar opportunity for U.S. financial services providers by 2010. Everybody listening? Good. The forces that redrew the retirement saving scene in the 1980s are at work again. Employers are converting defined-benefit programs to defined-contribution schemes, supported by e-commerce infrastructure and propelled by innovations on the product side." (Booz-Allen & Hamilton)

American Dental Association Sues Aetna, Alleges ERISA Violation
Excerpt: "The American Dental Association (ADA) and two of its member dentists filed the lawsuit in federal court in Chicago on Aug. 15, 2001. The dentists-- who do not belong to Aetna's provider network-- treat many Aetna subscribers who have health plans governed by the Employee Retirement Income Security Act (ERISA). The lawsuit alleges Aetna violated ERISA rules when it failed to pay the dentists' actual charges for treatment they gave to Aetna members." (insure.com)

Employer Must Notify Employees of Method It Uses To Determine 12-Month FMLA Leave Period
An employer that did not notify employees of the method that it would use to determine the 12-month period during which an employee's absence may qualify for leave under the Family and Medical Leave Act (FMLA) must then apply the method that is most beneficial to the employee. This was the decision of the Ninth Circuit U.S. Court of Appeals in Bachelder v. America West Airlines, Inc. (No. 99-17458). (Spencernet)

Vanpool Program Reduces Stress, Increases Fellowship
Excerpt: "USAA began the program in 1977 at its headquarters in San Antonio, Texas, to conserve fuel and to provide safe, affordable transportation for its employees. The Southeast Regional Office in Tampa started in 1987. Employees pay between $13.70 and $36.25 every two weeks, depending on how far away they live. That covers the cost of gas, maintenance, insurance, license fees and depreciation." (St. Petersburg Times via IFEBP)

Different Times Require Different Styles at Work
Excerpt: "Here's an update on various 'styles' that you'll find in today's workplace: Casual styles ... A 'dressing down' at the office doesn't always mean being yelled at--today it also means wearing casual clothes. And no one is more interested in this trend away from formal attire than manufacturers of slacks, jeans and other informal attire." (Chicago Tribune)

Retirees Face Diminishing Health Benefits
Excerpt: "In 1991, 88 percent of employers with more than 1,000 workers offered retiree health benefits to those under 65 years old. In 2000, that figure declined to 73 percent, according to the Employee Benefit Research Institute, a nonpartisan research organization. J.C. Penney sent letters to workers informing them that anyone hired after the new year won't get health insurance when they leave the company." (The Dallas Morning News via IFEBP)

Opinion: the Futility of the "Medical Necessity" Standard (PDF)
Excerpt: "'Medical necessity' defines patients' entitlements under various health plans: they can rightly expect their plans t cover everything that is necessary. It also marks the limits beyond which patient expectations should not tread. Medical necessity provides the conceptual fulcrum of virtually all health plan contracts, seemingly offering a bright promise of excellent-but-not-excessive medicine. Unfortunately, the reality could hardly be further from the promise." (E. Haavi Morreim, published in Regulation magazine by the Cato Institute)

Opinion: Hidden Barriers to Health Coverage
Excerpt: "[S]ome employers raise the bar enough to prevent or discourage their own workers from getting the insurance they do offer. Some companies insist, for instance, that their workers foot a big portion of the monthly bills, and the only plans they offer may have high premiums, putting them out of the reach of most lower- paid workers." (New York Times; free registration required)

House Patients' Rights Bill Would 'Undercut,' 'Rollback' States' Laws, Editorials Argue
Excerpt: "Although patients would 'gain at least a little protection' under the patients' rights bill (HR 2365) that the House passed earlier this month, a Los Angeles Times editorial warns that the legislation would override 'stronger patient protections' in California's patients' rights law and urges House and Senate negotiators to 'get to work on changing that.'" (KaiserNetwork.org)

Business Organizations Wary of Patients' Rights Compromise, To Lobby Against Senate Bill
Excerpt: "Fearing that House and Senate negotiators will 'strike a deal' on patients' rights legislation, business lobbyists have initiated a new lobbying strategy to 'limit the fallout,' CongressDaily reports." (KaiserNetwork.org)

Mississippi Gaining as Healthcare Lawsuit Mecca
Excerpt: "If Congress makes it easier for injured patients to sue health insurance companies, lawyers here [in Mississippi] will be well prepared. In this state, especially in some of its poor rural counties, lawyers have won tens of millions of dollars in jury verdicts against large national companies, including drug manufacturers accused of selling unsafe products." (New York Times; free registration required)

Opinion: Rewarding Doctors for Quality Care Isn't So Simple
Excerpt: "The Blue Cross move had the flavor of a public relations ploy aimed at patients and doctors. But it also upstaged a broader effort by a large group of health plans and physician groups to hammer out their own program to promote medical quality. Such a program would include a standard way of measuring quality, standard incentives for doctors and require all health plans to participate." (Los Angeles Times)

(Following items are in both editions of the BenefitsLink Newsletter)

ERISA Industry Group Supports Legislation to Exempt Stock Options from Employment Tax Withholding
Excerpt: "Dear Senator Clinton: The ERISA Industry Committee (ERIC) strongly supports your legislation (S.1383) to clarify that Congress never intended to subject income from Employee Stock Purchase Plans (ESPPs) and Incentive Stock Options (ISOs) to employment tax and wage tax withholding." (ERIC - the ERISA Industry Committee)

Exorcising Underwater Stock Options
Excerpt: "By far, the best approach to dealing with underwater stock options is to educate and remind optionees that their stock options are a long-term compensation device and that the typical 10-year option term allows more than enough time for their options to come back to life." (Westward Pay Strategies)

Newly Posted or Renewed Job Openings (Post Yours!)

Executive Compensation & Benefits Consultant

for Clark Bardes Consulting/Compensation Resource Group, Inc
in CA, DC, GA, IL, MA, NY, OH, TX

Pension Consultants/Administrators; F/T & P/T

for Northern NJ Mid-Size Pension Consulting Firm
in NJ, NY

Executive Benefits Associate

for Winged Keel Group
in NY

Account Service Leader/Plan Administrator

for INVESCO Retirement, Inc.
in GA

Operations Disbursement Analyst

for ICMA Retirement Corporation
in DC

Executive Compensation & Benefits - Analyst/Sr. Analyst

for Clark/Bardes Consulting - CRG
in TX

Implementation Specialist

for Financial Engines
in CA

Newly Posted Conferences (Post Yours!)

The 2001 PenServ Fall Seminar Series

in NY, TX on October 2, 2001
presented by PenServ, Inc.

INTRODUCTION TO 401(k) (2 Day workshop) - 13 Locations

in CA, CO, GA, IL, MA, MI, MN, MO, NC, PA, TX, WA on November 1, 2001
presented by SunGard Corbel