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The BenefitsLink Newsletter -
Welfare Plans Edition
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April 3, 2002 - 6,435 subscribers
Today's sponsor: SunGard Corbel

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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)

Obese Americans Get a Tax Break
Excerpt: "All Americans deemed obese by their doctor can now deduct their out-of-pocket costs for certain weight-loss programs as a medical expense, the Internal Revenue Service ruled Tuesday. Previously, only obese Americans with high blood pressure, heart disease or other conditions related to their weight had been able to take such deductions." (USA Today)

Full Text of Rev. Rul. 2002-19; Weight-Loss Programs Deductible for Diagnosed Obesity (PDF)
Advance copy from IRS web server. Excerpt: "Uncompensated amounts paid by individuals for participation in a weight-loss program as treatment for a specific disease or diseases (including obesity) diagnosed by a physician are expenses for medical care that are deductible under § 213, subject to the limitations of that section. The cost of purchasing diet food items is not deductible under § 213." (Internal Revenue Service)

Democratic National Committee Names Medical Privacy 'Top' Campaign Issue
Excerpt: "The Democratic National Committee for the first time has named medical privacy a 'top campaign policy issue' and plans to urge Democratic candidates to 'push opponents to take a stance' on the issue, TechnologyDaily/PM reports." (KaiserNetwork.org)

Analysis: Courts of Appeal Address COBRA Issues
Excerpt: "The First and Third Circuit Courts of Appeal recently have addressed some fundamental COBRA questions.... [T]he First Circuit Court of Appeals confirmed that ERISA does not require courts to assess civil penalties against plans that fail to satisfy certain COBRA notice requirements ... [T]he Third Circuit Court of Appeals reiterated the principle that individuals generally do not have COBRA rights unless they are participants in a group health plan when a 'qualifying event' occurs." (Deloitte & Touche)

Spencer Survey of COBRA Coverage Continues
Charles D. Spencer & Associates, Inc., continues to collect information for its 2001 Spencer survey of COBRA continuation coverage. More than 810,00 employees already have been counted, with the average COBRA subsidy at more than 150% of active employee costs. The deadline for completing the survey is May 17. (Spencernet)

Anthem, Oxford Health Plan Bosses Get Pay Boosts
Excerpt: "Anthem Inc. and Oxford Health Plans Inc. rewarded top executives with major pay increases last year for company performance and corporate change." (The Hartford Courant)

Celebrate National Workplace Napping Day
Excerpt: "The third annual National Workplace Napping Day is only a couple of days away! Boston University Professor William Anthony and his wife Camille, co-authors of The Art of Napping at Work (Larson) have declared Monday, April 8, 2002 as National Workplace Napping Day and they are on a mission to erase the stigma of napping that permeates our culture." (KMED-AM)

20 Low-Cost Benefits Ideas
Excerpt: "Many companies either cut back or held the line on salaries this year, placing benefits managers in the position to counter these actions with other offerings to boost morale.... [T]here are many offerings that mean a great deal to staff, but have a small impact on your bottom line.... Ideas to consider:" (IOMA's Managing Benefits Plans via International Foundation of Employee Benefit Plans)

In Op-Ed, OPM Director Encourages Federal Employees To Join Long-Term Care Insurance Program
Excerpt: "The new Federal Long-Term Care Insurance Program offers a 'unique opportunity for families to plan for the future' and the 20 million eligible federal employees, military personnel and families should enroll, Kay Coles James, director of the Office of Personnel Management writes in a Washington Times opinion piece ..." (KaiserNetwork.org)

Proposed HIPAA Privacy Regulations - Reviewing the Actual Language
Excerpt: "HHS has also proposed a number of changes of particular concern to employers, including: a specific reference in the regulations to permit the sharing of enrollment and disenrollment data with plan sponsors without the need to amend the plan document; an acknowledgement that PHI does not include 'employment records'; and enabling a 'hybrid entity' to define which of its parts are the 'covered entity,' for example the self-insured health plan, and which are non-covered components ..." (Deloitte & Touche)

More Mixed Reactions to the Proposed Changes to the HIPAA Privacy Regulation
Excerpt: "[A] closer examination of the actual proposed rule is raising questions about whether changes make it easier to use identifiable information for marketing purposes without authorization." (HIPAAdvisory)

Analysis: DHHS Attempts to Reduce Administrative Burdens of HIPAA Privacy Rule
Excerpt: "The Proposed Rule attempts to make the Privacy Rule requirements less burdensome and costly for employers. It clarifies that group health plans may disclose, and authorizes health insurance issuers to disclose, enrollment and disenrollment information to an employer or other group health plan sponsor without amending plan documents. The Proposed Rule also revises the definition of PHI to exclude a covered entity's employment records about its employees from the definition." (McDermott Will & Emery)

Analysis: Modifications To HIPAA Privacy Regulations
Excerpt: "The regulations generally require covered entities to obtain individual authorization for any use or disclose of protected health information ('PHI').... Plans must be in compliance with the regulations by April 14, 2003. We discuss below HHS' proposed modifications to the privacy regulations that impact health plans and score these modifications as favorable, unfavorable, or neutral." (Groom Law Group)

Strategies for Dealing with Retiree Medical Issues (PDF)
Article begins on page 5. Excerpt: "[T]he environment that supported the proliferation of retiree health benefits has changed dramatically, particularly in the areas of workforce demographics and healthcare costs.... This article discusses some of the options available for employers in managing their retiree medical plans." (Robert L. Schmidt, FSA of Milliman USA)

How Companies Plan to Fight Predicted 14% Health Care Price Hikes
Excerpt: "A survey of 700 organizations by Lincolnshire, Ill.-based Hewitt Associates asked respondents how much added cost they could absorb over the next five years for health care benefits.... When asked to gauge their interest in employing certain cost-control methods, respondents gave the most attention to increasing employee premium contributions." (IOMA's Managing Benefits Plans via International Foundation of Employee Benefit Plans)

2001 Survey of Plans: State Legislative Health Care and Insurance Issues (PDF)
67 pages. Excerpt: "An annual survey is sent to each of the independent Blue Cross and Blue Shield Plans at the close of the state legislative session. The survey highlights major health legislation enacted in 2001 and identifies the most significant issue trends for the Plans in 2002. This report presents the survey findings and is designed to assist member Plans in preparing for the 2002 state legislative sessions." (BlueCross BlueShield Association)

Links to Extensive Appendices to 2001 Survey of Plans: State Legislative Health Care and Insurance Issues (PDF)
Includes State Small Group Insurance Reform Laws - Chart; State Implementation: HIPAA Group-to-Individual - Chart; Scope of State External Review Laws - Chart; State Medical Savings Account Laws - Chart; State Prompt Payment Requirements - Chart; State Privacy Implementation: Federal Gramm-Leach-Bliley Act (GLBA) - Chart. (BlueCross BlueShield Association)

Healthcare Crisis Grows For Middle Class; Employers Have Stake, Too
Excerpt: " As the number of uninsured grows, the problem feeds the already-spiraling costs that companies face in insuring workers.... To understand the complex relationship between the number of uninsured and overall healthcare costs, it helps to think of the American healthcare system as one of Rube Goldberg's complex machines ..." (Christian Science Monitor)

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

Bill Targeting Stock Option Accounting Faces Opposition
Excerpt: "A bill to deny companies tax breaks for granting stock options to employees faces opposition in House and Senate tax committees and from a countermeasure offered by a Senate committee chairman." (Bloomberg News via the Boston Globe)

Opinion: Stock Options-- Now You Care?
Excerpt: "It seems that when investors were getting wealthy by holding stocks of almost any flavor stock options grants were of little concern. Now that the stock market has turned sour, investors are no longer very patient with insiders getting multi-million dollar stock options grants. Well, it's about time. The Motley Fool has been howling about this for several years." (The Motley Fool)

CalPERS Wants Aetna To Change Governance Measures
Excerpt: "The nation's largest pension fund is urging Aetna Inc. to revamp key corporate governance provisions." (TheDeal.com)

Spencer Publishes 5500 Analysis For 2001 Plan Years
A new Spencer analysis finds that the Form 5500 and 5500-EZ for the 2001 plan year are essentially unchanged from the prior year, as noted in the just-released line-by-line analysis by Charles D. Spencer & Associates, Inc. (Spencernet)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
401(k) Investment Educator for ADP, Inc.
in CA, MA, TX
Benefits Specialist for Heartland Health
in MO
Manager, Retirement Plans for LifeBridge Health, Inc.
in MD
Senior 401(k) Administrator for The Pension Group, Inc.
in CA
Benefits Paralegal/ERISA Specialist for Florida Power & Light Company
in FL

Newly Posted Webcasts (Post Yours!)
Confronting the Challenges of Long-Term Care: A State Focus on April 2, 2002
presented by KaiserNetwork.org

Newly Posted Conferences (Post Yours!)
ASPA Benefits Council of DFW Legislative Updatein TX on April 24, 2002
presented by ASPA Benefits Council of Dallas/Ft. Worth

Newly Posted Press Releases
AFS Releases AFS-LINK (American Financial Systems, Inc.)
ORTEC Introduces Advanced Retirement Planner: "RAMI" (ORTEC International)

Subscribe to the Retirement Plans Edition, too (click)

Copyright 2002 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.