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The BenefitsLink Newsletter -
Welfare Plans Edition
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May 31, 2002 - 6,419 subscribers
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Analysis: IRS Permits Automatic Cafeteria Plan Enrollments
Excerpt: "While the ruling allows automatic enrollments for federal tax purposes, employees could still try to challenge automatic enrollments under state wage withholding laws, particularly where opt-outs are not freely allowed. The Department of Labor has suggested in the past that such state laws may be preempted for employers sponsoring ERISA plans. However, employers may want to consult with legal counsel on this issue." (Mercer Human Resource Consulting)

Overview: Form 5500 Filing Requirement Suspended for Cafeteria Plans and Certain Other Plans
Excerpt: "On April 4, 2002, the Internal Revenue Service provided an advance release of Notice 2002-24 announcing the suspension of the Form 5500 and Schedule F filing requirement imposed on (a) cafeteria plans under section 125 of the Internal Revenue Code of 1986, as amended (the 'Code'), (b) educational assistance plans under Code section 127, and (c) adoption assistance plans under Code section 137." (Kilpatrick Stockton LLP)

Despite Ambiguous Exclusion Provision, Denial of Coverage Was Not Unreasonable
Fay v. Oxford Health Plan (2d Cir., March 27, 2002). Excerpt: "A federal appeals court ruled that a group health plan's denial of coverage for in-home nursing care for an invalid plan participant was reasonable because the plan presented evidence that such nursing care was not the most appropriate treatment option." (Thompson Publishing Group)

Dynegy CEO to Receive Three Years' Salary as Severance Pay
Excerpt: "Dynegy Inc. chairman and chief executive Charles L. Watson, who agreed this week to leave the troubled energy company, is set to receive at least $33 million more in severance payments than he would have had he served out his contract." (StarTribune.com)

The Many Benefits of Providing Benefits
Excerpt: "A national contest aimed at recognizing private companies that provide excellent employee benefits has turned up a list of 'best practices' that earn employee loyalty and help the companies attract talent." (Business Week via Yahoo! Finance)

Million-Dollar Fine on Kaiser HMO Rejected by Judge but Soon Reinstated by California Regulator
Excerpt: "A state administrative law judge has struck down a landmark $1.1-million fine against Kaiser Permanente over alleged lapses in patient care. But the state official who regulates HMOs quickly overruled the decision Thursday. Judge Michael C. Cohn ruled that the Department of Managed Health Care overstepped its authority when it penalized Kaiser.... The state's HMO czar, Daniel Zingale, said Cohn's ruling, if allowed to stand, would gut the state's patient protection laws." (Los Angeles Times; free registration required)

Drug Industry More Interested in Profits than New Medicines, USA Today Editorial Says
Excerpt: "A study released this week by the National Institute for Health Care Management finding that only 15% of drugs approved by the FDA from 1989 to 2000 were 'highly innovative' is 'just the latest evidence suggesting the drug industry is more interested in fattening its bottom line than funding innovation,' a USA Today editorial states." (KaiserNetwork.org)

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

Overview: DOL Makes Delinquent Filer Voluntary Compliance (DFVC) Program Easier
Excerpt: "Effective March 28, 2002, the DOL released a revised DFVC program that provides for substantially reduced civil penalties ... Because of the changes, we encourage employers and/or plan administrators to (a) review their various employee benefit plans to determine whether Form 5500 filings are, in fact, required for such plans, (b) verify that Form 5500s have been filed for all appropriate plan years, and (c) evaluate whether late filings need to be made under DFVC or otherwise." (Kilpatrick Stockton LLP)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Manager for TPA for Career Consulting Services, Inc.
in IL
401(k)/DC Pension Consultant for CBIZ Retirement Services, Inc.
in NY
Relius Administration Support Analyst for SunGard Corbel
in FL
Education Specialist for CIGNA Retirement and Investment Services

Newly Posted Press Releases
THE RETIREMENT ANALYST LAUNCHES BILINGUAL PARTICIPANT ADVICE: Retirement Planning Program Extends to Spanish-Speaking Workforce (Retirement Analyst, The)

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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.