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The BenefitsLink Newsletter -
Welfare Plans Edition
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October 15, 2001 - 6,428 subscribers
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Health Care Costs 2002 - a Watson Wyatt Worldwide Survey
Excerpt: "Health plan costs for 2002 are projected to rise even faster than they have in the past two years. Employers health plan costs for active employees will rise by 13.6 percent, compared with trends of 8.1 percent and 12.2 percent for 2000 and 2001 respectively." (Watson Wyatt)

OPM Finalizes the Allotment Regulations for the Federal Health Insurance Premium Conversion Plan
Excerpt: "EBIA Comment: This final rule primarily caught our eye because in the Preamble it mentions a worksheet that is available to calculate the effect that participation in the Premium Conversion Plan has on Social Security benefits. The analysis used in this worksheet would also apply to participation in a private employer's cafeteria plan." (EBIA Weekly)

Congress, Bush Administration Propose Measures to Help Unemployed Retain Health Insurance
Excerpt: "Lawmakers are proposing 'several approaches' to help provide health insurance benefits to 'hundreds of thousands' of workers laid off in the wake of the Sept. 11 attacks on the World Trade Center and the Pentagon, the New York Times reports." (KaiserNetwork.org)

Trial to Begin in Benefits Case that Prompted "Drive-Through Baby Delivery" Federal Legislation
Excerpt: "Steve and Michelle Bauman hope they can finally put Michelina to rest, six years after the 1-day-old girl died after leaving the hospital. The couple claim their former HMO's 24-hour discharge policy resulted in her death from an infection that would have been detected had she stayed in the hospital another day. The Baumans, formerly of Williamstown, hope to convince a jury of that in what could be a precedent-setting trial." (The [Bergen County, N.J.] Record)

Plan Sponsor Violated ERISA by Failing to Independently Evaluate Recommendation of TPA and Insurer
Stumpf v. Medical Benefits Administrators (D. Neb. 2001). Excerpt: "In analyzing the claim, the court looked closely at the testimony of the employer's Chief Financial Officer (CFO), who acted as ERISA plan administrator and made the ultimate decision to deny benefits. The CFO admitted that his decision was based on the recommendations of the TPA and the insurer; that he did not review any medical records; that he had no medical or scientific background ..." (EBIA Weekly)

Employer Ordered to Continue Paying Benefits While Court Determines Propriety of Plan Amendment
Racine v. Infinia Health Care, Inc. (D. Ne. 2001). Excerpt: "On the same day that [the plaintiff] became covered by the plan, he was admitted to the hospital for heart problems, which led to over $200,000 in medical expenses.... However, when the employee returned to work a few weeks later, he found a memo reminding all employees that the plan had a $75,000 annual cap on benefits--even though no such limit was described in the materials distributed by the employer before the enrollment date." (EBIA Weekly)

Employer Not Liable to Survivor When Employee Did Not Submit Life Insurance Application Before Date
Furman v. Physicians Premier Plan (E.D. Pa. 2001). Excerpt: "Three times--in January, March and August--the plan's TPA wrote to tell the employee that he needed to complete the insurance company's application before coverage would be effective. (The employer paid all premiums once coverage was effective.) No application was submitted, however, until the day the employee died of leukemia." (EBIA Weekly)

Proctor & Gamble to Loosen Domestic Partner Benefit Rules
Excerpt: "Procter & Gamble Co. will offer health and other benefits to domestic partners of its U.S. employees starting Jan. 1, the company confirmed Monday. Cincinnati-based P&G said it had dropped the requirement that half of a dependent's support come from the P&G employee, freeing both same-sex and opposite-sex partners to receive benefits." (The Cincinnati Enquirer)

California Governor Signs Bill Expanding Domestic Partner Rights
Excerpt: "Davis signed a measure that provides about a dozen rights enjoyed by heterosexual married couples to more than 16,000 registered gay, lesbian and senior domestic partners in California. It lets those who register as domestic partners with the California Secretary of State's Office make medical decisions for their incapacitated partners, sue for wrongful death, adopt a partner's child and will property to a partner." (Associated Press via Excite News)

Florida Teachers and School Administrators Get Statutory Death Benefits
Excerpt: "The Florida Legislature has created Section 112.1915, Florida Statutes, the 'Barry Grunow Act.' Named for the popular Palm Beach County high school teacher who was tragically shot to death by a student, the law provides benefits when a teacher or school administrator is killed as a result of an unlawful and intentional violent act inflicted by another person and [certain criteria are met]." (Cypen & Cypen)

More Companies Help Workers Buy Homes
Excerpt: "Harley-Davidson is helping Mike Lea walk to work. Not because the motorcycle manufacturer is contemplating a new line of business. Mr. Lea, a Harley employee, strolls to the office these days because his company helped him buy his own home - just three blocks from work. The Milwaukee-based company chipped in $2,500 toward a down payment on a fixer-upper Victorian." (Christian Science Monitor via IFEBP)

San Francisco Area Employers Consider Providing Reservists With Benefits Above Legal Minimums
Excerpt: "Bay Area cities and counties are moving to give extended pay and health benefits to military reserve employees called to active duty in the campaign against terrorism. State law requires local governments and public agencies to provide employees at least one month of paid time off annually for military obligations." (San Francisco Chronicle via IFEBP)

Manatee County Government Gives Physicians Incentives For Prescribing Targets
Manatee County Government, on the Gulf Coast of southwest Florida, employs 3,000 workers and covers 6,000 lives. Manatee County self-insures its point-of-service medical plan and contracts directly with providers, Robert Goodman, the County's health benefits manager, told workshop participants at the Pharmacy Benefit Management Institute annual conference. A third party administrator pays claims onsite and a pharmacy benefit management firm (PBM) administers the pharmacy benefits program. (Spencernet)

Polaroid Terminates Retiree Health Coverage
Excerpt: "Retirees at beleaguered instant film and camera maker Polaroid Corp. are about to receive a letter that their health and life insurance benefits will be terminated. An Oct. 9 letter from Polaroid's general counsel Neal Goldman began circulating among some retirees this week. The letter said the benefits would end immediately, according to retirees who have seen the letter." (Reuters via Excite News)

IRS Rules That Numerous Screening Tests Qualify as Medical Care Under Code Section 213
Priv. Ltr. Rul. 200140017 (June 25, 2001). Excerpt: "EBIA Comment: An expense may not be reimbursed by a health FSA unless, among other things, it was incurred for medical care under Code Section 213. We now have some specific guidance as to how the IRS determines whether screening tests constitute medical care." (EBIA Weekly)

How Baby Boomers Can Help Their Parents with Health Insurance Coverage
Excerpt: "If you're a baby boomer anxious about health care for your aging parents, you can reduce your stress by educating yourself about your parents' health and insurance needs. The key is knowing exactly what information you need and where to look for it. Forty-three percent of adult children with aging parents say their parents would most likely turn to them for health insurance information, according to a joint Family Circle/Kaiser Family Foundation (FC/KFF) survey." (insure.com)

New Mandated Coverage for Hearing Aid Health Coverage for Children in Connecticut
Excerpt: "As new health insurance plans are issued and older plans are renewed in Connecticut, a new mandate for coverage will begin taking effect. As of Oct. 1, 2001, all health insurance plans written or renewed in the state must include coverage for the cost of hearing aids for children age 12 and younger." (insure.com)

New Mandated Coverage for Hearing Aid Health Coverage for Children in Maryland
Excerpt: "As new health insurance plans are issued and older plans are renewed in Maryland, a new mandate for coverage will begin taking effect. As of Oct. 1, 2001, all health insurance plans written or renewed in the state must include coverage for the cost of hearing aids for children under 18." (insure.com)

Mental Health Parity Extension Included in House Economic Stimulus Bill
Excerpt: "The ERISA Industry Committee reports that the House Ways and Means Committee on October 12 included a two-year extension of the existing mental health parity requirement found in Sec. 9812 of the Internal Revenue Code as part of its markup of H.R. 3090." (BenefitsLink)

Although Bush Says Patients' Rights Are Not Forgotten, Time May Have Run Out
Excerpt: "Despite the increased government focus on national security and bioterrorism after the Sept. 11 attacks on the World Trade Center and the Pentagon, President Bush says he remains 'committed' to Medicare reform and patients' rights, the AP/Nando Times reports." (KaiserNetwork.org)

Survey Finds That Communication During a Leave of Absence Improves Employee Morale
Intracorp and CIGNA IntegratedCare recently released the results of a survey that suggest that there is a benefit to greater communication between employers and injured/ill employees during a leave of absence. According to the survey, different employees have various concerns and need specialized communication based on their medical condition, financial vulnerability, workplace knowledge, length of absence from work, and other factors. (Spencernet)

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


ASPA Advises Agencies of Two "Ongoing Concerns" Regarding Revised Form 5500 Reports
In a recent letter to the Internal Revenue Service, the Department of Labor's Pension and Welfare Benefits Administration, and the Pension Benefit Guaranty Corporation, the American Society of Pension Actuaries (ASPA) provided its comments regarding the revised Form 5500 series annual reports. The agencies had requested comments on the revised annual reports earlier this year. (Spencernet)




Newly Posted or Renewed Job Openings (Post Yours!)
Pension Plan Administrator for The Angell Pension Group, Inc.
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ALL STATES
Benefits Compliance Paralegal for Aon Consulting
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GA
Executive Benefits/Risk and Liability Financing Consultant for Leading Global Professional Services Company
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OH, PA
Plan Administrator for Ceridian
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CA
Pension Account Executive for Diversified Investment Advisors
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MA
Pension Administrator for Pension Benefit Consultants, Inc.
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401(k) Plan Administrator for Northeast Planning Services, Inc.
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Director of Relationship Management for Highly Successful Consulting Firm
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Copyright 2001 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.