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The BenefitsLink Newsletter -
Welfare Plans Edition
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August 16, 2002 - 6,490 subscribers
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Debate Heats Up Over California's Paid-Time-Off Family Leave Bill
Excerpt: "bill that would make California the first state to grant paid family leave so employees could care for relatives is nearing a key vote, and groups involved in the issue are cranking up the rhetoric. The controversial measure ... would allow workers to collect up to 60 percent of their usual salary for as many as 12 weeks a year while they take care of a seriously ill child, spouse, domestic partner or aging parent or bond with a new child." (The San Diego Union-Tribune via International Foundation of Employee Benefit Plans)

Providers, Rights Advocates Weigh In On Possible Effects of New Medical Privacy Rules
Excerpt: "Although privacy advocates 'hit the roof' after the Bush administration announced medical privacy regulations that are less restrictive than standards first proposed by the Clinton administration, hospitals and health care providers 'applaud[ed]' the rules, which became official on Aug. 14, saying they 'will maintain patients' privacy and could lead to better health care,' the San Francisco Chronicle reports ..." (KaiserNetwork.org)

Overview: Final Changes to HIPAA Privacy Rules
Excerpt: "[I]n those states such as Minnesota, where state law already requires written patient consent prior to the disclosure of health information to unrelated entities, the elimination of HIPAA's consent requirement is a hollow benefit for providers." (Faegre and Benson LLP)

Healthcare Woes Boost Federal Generic Drug Bills
Excerpt: "Of the many flaws in the U.S. health care system, access to generic drugs has not been a prominent political theme. It involves an obscure area of patent law. Until the past few weeks, even enthusiastic supporters saw little hope for the legislation that seeks to bring such medicine to the market more quickly." (Washington Post)

Over-The-Counter Claritin Could Cut Prescription Drug Benefit Costs by 10%
Excerpt: "Spending for Claritin and related drugs cost drug benefit plans an average of $20.37 per member per year." (BenefitNews.com)

Severance Claims by Enron's Former Executives Anger Laid-Off Workers
Excerpt: "Several ex-Enron employees are outraged that their attempt to obtain $13,500 in severance for all former workers may be derailed by a few ex-executives' demands for as much as $1.6 million." (The Houston Chronicle via Society for Human Resource Management)

Court Enforces Plan-Imposed Time Period for Filing Suit Despite Lack of Denial Notice Under DOL Regs
Hand v. Stevens Transport, Inc. Employee Benefit Plan (Tex. Ct. App. 2002). Excerpt: "We found this state appellate court case interesting because it addresses how the statute of limitations for ERISA benefits claims interacts with the related requirement that ERISA claimants exhaust plan claims procedures before filing suit.... [E]ven though the couple was excused from filing a timely request for review, they were ... required to file their lawsuit within the plan-imposed limitations period." (EBIA Weekly)

Trial Court Allows State-Law Bad Faith Claim to Proceed Against ERISA Plan Insurer
Rosenbaum v. UNUM Life Ins. Co. (E.D. Pa. 2002). Excerpt: "The [federal district] court found that the Pennsylvania bad faith statute for insurance claims fell within ERISA's savings clause, which exempts from preemption any state law that regulates insurance.... EBIA Comment: This is yet another case in a litigation trend that could make ERISA administration more troubling and costly for insurers." (EBIA Weekly)

To Trigger Medical Plan's Illegal Activity Exclusion, Drunk Driving Must Contribute to Accident
Smathers v. Multi-Tool, Inc. (3d Cir. 2002). Excerpt: "[T]he court found that the language of the plan required a causal connection between the participant's illegal activity and the accident. It was not enough that the participant was engaged in an illegal activity ... EBIA Comment: [A] majority of the federal courts agree that, when determining the standard of review, the plan in effect on the date when the administrator actually makes the determination should control." (EBIA Weekly)

Plaintiffs Ages 40 To 49 May Pursue ADEA Claim That Firm Favored Older Employees
A group of plaintiffs between the ages of 40 and 49 may pursue an action under the Age Discrimination in Employment Act (ADEA) alleging that their employer discriminated against them in favor of older employees. This was the decision of the Sixth Circuit U.S. Court of Appeals in Cline, et al. v. General Dynamics Land Systems, Inc. (No. 00-3468). (Spencernet)

Links to Items on Executive Comp, Benefits in General
(These items appear in both editions of the BenefitsLink Newsletter)

Effective Dates For Non-Blackout Provisions of Sarbanes-Oxley Act
Excerpt: "The blackout requirements are effective January 26, 2003.... [but the Sarbanes-Oxley Act] contains many other provisions that become effective earlier. For example, some of the new SEC certification rules for CEOs and CFOs of publicly-held companies are effective immediately, and some others will be effective no later than August 29, 2002. Similarly, a new ban on personal loans by public companies to executive officers and directors is effective now." (EBIA Weekly)

Opinion: Three Cheers for Andy Grove for Intel's Decision to Refuse Expensing Stock Options
Excerpt: "The options issue threatens not only to slow recovery down, but, far more important, to rein in the kind of vibrant entrepreneurial innovation so essential to U.S. prosperity. The harder it is for innovations to make their way to the marketplace, the worse the economy will perform. It's a simple equation." (SmartMoney.com via Yahoo! Finance)

Opinion: By Not Expensing Stock Options Now, High-Tech Firms Are Just Prolonging the Pain
Excerpt: "The tech sector's head-in-the-sand reaction to the need to reform stock-option accounting practices is surprising for an industry that likes to pride itself on its supposed ability to respond rapidly and effectively to changing business conditions. Clearly, that's not happening this time around." (The San Francisco Chronicle)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Senior Defined Benefit Analyst for Towers Perrin
in MA
Senior 401(k) Administrator for The Pension Group, Inc.
in CA
Installation Conversion Consultant Project Leader for Wachovia Corporation
in NC
Director - Benefits for H&R Block
in MO
Regional Sales Representative - Qualified Retirement Plan for Metavante 401(k) Services
in DC, FL, GA, LA, MD, MI, NC, ND, NJ, NY, OH, PA, TN, TX, VA
Qualified Plan Administrator for Lane Gorman Trubitt, L.L.P.
in TX
Employee Benefits Attorney for Kane and Koltun, Attorneys at Law
in FL
Actuary -- Senior Pension Actuary for Pacific Coast Actuaries, Inc.
Actuarial Student for Transamerica
in CA

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