BenefitsLink Health & Welfare Plans Newsletter for March 21, 2002

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March 21, 2002 - 6,505 subscribers

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(Help BenefitsLink to provide this 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)

Four Legislators Who Triumphed on Election Reform Say They'll Tackle Healthcare Next
Excerpt: "The four congressional mavericks who maneuvered the most sweeping election-funding changes in a quarter century past the political establishment here said yesterday that they hope to use similar tactics to drive prescription drug coverage for senior citizens and a Patients' Bill of Rights through a closely divided Congress." (Boston Globe)

Liquidation Causing End to Health Coverage for LTV Retirees
Excerpt: "LTV Steel Co. retirees and spouses yesterday swamped a small hall in Mount Oliver, worried about what they'll do when their company-paid health-care coverage ends at the end of this month.... The Cleveland-based steelmaker's bankruptcy and liquidation is forcing approximately 80,000 LTV retirees to shop for replacement health-care coverage ..." (Pittsburgh Post-Gazette)

Health Plan Sponsors Should Consider Whether Summary Information Will Suffice, Attorneys Say
Excerpt: "Employers that sponsor health plans should rethink their use of employee health information, and even consider restructuring their organizations, to minimize the impact of HIPAA's privacy rules, two health care attorneys suggested at a recent conference. Otherwise, improper use or disclosure of this information could result in exposure to employee lawsuits, even though the rules themselves do not create a private right to sue." (Thompson Publishing Group)

House of Representatives Unanimously Passes Telecommuting Bill for Federal Contractors
Excerpt: "[With a vote of 421 to 0,] House lawmakers on Wednesday overwhelming approved a measure to enable employees of contractors who work for federal agencies to begin telecommuting." (GovExec.com)

Denial of LTD Benefits Based On Preexisting Condition Exclusion Was An Abuse of Discretion
An insurer abused its discretion when it denied a beneficiary's claim for long term disability benefits based on the preexisting condition limitation in the LTD plan. This was the ruling of the Fourth Circuit U.S. Court of Appeals in Thompson v. Life Insurance Company of North America, et al. (No. 01-1383). (Spencernet)

Court Holds Arkansas Wrongful Death Statute Is Preempted by ERISA In Subrogation Case
In the Matter of Edward Jackson Allen v. The Wal-Mart Stores, Inc., Associates' Health and Welfare Plan (E.D. Ark. 2002). Excerpt: "[T]he Court, following Egelhoff, held that Arkansas' wrongful death statute was preempted by ERISA. The Court reasoned that, as in Egelhoff, 'the Plan terms yield a different result as to how plan assets are to be recovered than how the Arkansas Wrongful Death statutes does.'" (Attorney Thomas H. Lawrence)

Opinion: Careless Goofs In Patient Protection Proposals Are Dangerous
Excerpt: " Everyone knows that the intent of Patient Protection legislation is to regulate and pressure HMOs....However, that's very different from the vast majority of American employers, who sponsor self-funded trusts which pay for medical costs, usually after the medical service has been received. The employer's plan does not make medical decisions.... So, legislation designed for HMOs is like a square peg in a round hole when applied to non-HMO plans." (Frederick D. Hunt, Jr. of the Society of Professional Benefit Administrators)

The Growing Case for Using Physician Incentives to Improve Health Care Quality (PDF)
23 pages. Excerpt: "To gain a sense of what has been tried and achieved thus far, the National Health Care Purchasing Institute (NHCPI) commissioned Bailit Health Purchasing, LLC (BHP) and Sixth Man Consulting, Inc. (6MC) to conduct a study of quality-focused, physician-level incentive strategies implemented to this point. In this report, NHCPI seeks to document the experience of innovators and leaders-- highlighting successes, defining barriers, and offering lessons learned." (The Robert Wood Johnson Foundation, published online by National Health Care Purchasing Institute)

Opinion: Health-Care Credits-- a Tax Shot in the Arm
Excerpt: "At first glance, extending so-called 'COBRA' coverage sounds like a decent solution.... What's not to like? Plenty.... Here's a better remedy: Take the money that would have gone to extending COBRA coverage for some displaced workers and give it to all unemployed workers to buy the health plan of their choice." (Washington Times)

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

Full Text of Proposed Amendment to PTE 96-62 Expanding Availability of Expedited PT Exemptions
Excerpt: "[I]n order to assist parties who in the future wish to utilize ... PTE 96-62, the Department is proposing to expand [that procedure] to permit parties to either base their submission on substantially similar transactions described in two individual exemptions granted within the past 60-months; or on one individual exemption granted within the past 120-months and one transaction which received final authorization by the Department under PTE 96-62 within the past 60-months." (U.S. Department of Labor, Pension and Welfare Benefits Administration)

Stock Option Showdown: It's U.S. Corporates vs. the IASB
Excerpt: "[L]ate last year, the [International Accounting Standards Board] proposed that options be measured at fair value on the date they vest with employees, and that the compensation expense be accrued over the vesting period of the options. Not surprisingly, the U.S. corporate community came out swinging." (CFO.com)

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