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October 7, 2002 - 7,276 subscribers
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HMO Named Top Information Technology Innovator Among Large U.S. Companies
Excerpt: "HIP [Health Plan of New York] employees solve customer-service problems on the first call 93% of the time. With that quality of service, HIP maintains it has the lowest customer-turnover rate of any medical plan in the country." (Information Week)

Can an Employee Using FMLA Pre-Pay His Health Plan Premiums Through Our 125 plan?
Excerpt: "Yes, if your cafeteria plan documents provide for that option. The IRS has issued final FMLA/cafeteria plan regulations that address how benefits will be paid for during FMLA leave. Treas. Reg. Sec. 1.125-3. These regulations permit three payment options for employees who continue their group health coverage during an unpaid FMLA leave to pay their share of the premium ..." (EBIA Weekly (Question of the Week))

Flexible Spending Accounts on Way for Federal Government Workers
Excerpt: "FSAs are common in the private sector and in state and local governments. They are also already in use in some parts of the federal government, including the judiciary branch, the Postal Service and some financial regulatory agencies. But they aren't available in the executive branch as a whole." (Washington Post)

Employer Violated ERISA 510 by Failing to Continue Health Coverage for Disabled Inactive Employee (PDF)
13 pages. Lessard v. Applied Risk Management (9th Cir. 2002). Excerpt: "[A provision in the employer's agreement to sell its assets] facially discriminates against employees who were on disability, workers' compensation, and any other form of extended leave, explicitly excepting from its separate schedule for conditional transfer [to the assets' buyer] any employee who was absent from work due to vacation, holiday, or personal reasons.... This conduct constitutes discrimination on its face." (U.S. Court of Appeals for the Ninth Circuit, via

8th Circuit: Independent Medical Examiner's Report Justifies LTD Denial (PDF)
Smith v. UNUM Life Insurance Company, No. 02-1068 (8th Cir. 2002). Excerpt: "UNUM sought input from [plaintiff's treating physician] and offered [plaintiff] the opportunity to respond to the medical opinions of [the independent medical examiner] and [UNUM's reviewing physician]. UNUM weighed all the evidence presented.... Certainly, reasonable minds could also disagree with their conclusions. Under our precedent, UNUM did not abuse its discretion." (U.S. Court of Appeals for the Eighth Circuit, via

Bush Threatens Veto of Defense Bill Due to New Disability Benefit
Excerpt: "Alarmed by the cost of expanding military entitlement programs, President Bush has threatened to veto the $355 billion defense authorization bill for the new fiscal year if House and Senate conferees do not eliminate new pension benefits for disabled military retirees that could cost from $18.5 billion to $58 billion over the next decade." (Washington Post)

Advances in Medical Technology for Children Bring Little Miracles But Big Costs
Excerpt: "For children born with heart defects-- about 30,000 a year in the U.S.-- doctors are logging successes. One reason health insurers are paying [Children Hospital's] rising prices-- although payments lag behind several years-- is that the hospital is showing results." (The Boston Globe)

Biz Groups Back Healthcare Purchasing Pools
Excerpt: "The National Federation of Independent Business says association health plans would make insurance more affordable for small businesses. Proposed legislation would exempt plans sold by national trade associations from state mandates and regulations." (Puget Sound Business Journal via; free registration required)

Opinion: Thoughts on Controlling Costs for Prescription Drugs
Excerpt: "Until recently, most prescription drugs were paid for out of consumers' pockets. In fact, in 1990 private insurers paid only 24% of prescription drug costs. But by 2001, third party payment accounted for 82% of all prescription sales at retail.... While pharmacy benefit managers are touted for their ability to control prescription drug costs, dramatic spending increases over the last several years make it clear that this model needs major refinement." (Paul Kelly of the National Association of Chain Drug Stores)

Opinion: Pharmaceutical Companies Pushing Drugs
Excerpt: "[I]t makes sense for the federal government to stop industry salesmen from buying the allegiance of doctors and HMO pharmacy managers with thinly disguised bribes. Not only do these distort professionals' choices of the best medicine for their patients; they also drive up the cost of drugs." (The Boston Globe)

Health Plans Are Offering Fewer Choices and Higher Costs
Excerpt: "This month starts another open enrollment period for the estimated 80 million Americans who participate in employer-sponsored health insurance plans.... Many workers ... will find fewer choices and higher costs, along with new options that reflect employers' moves to reduce costs and shift more responsibility for health care to their employees." (New York Times; free registration required)

California Consumers' Organization Balks at Introduction of New HMO With Fewer Choices
Press release. Excerpt: "[On Oct. 4, 2002] PacifiCare announced plans to launch a new California health maintenance organization (HMO) that would severely restrict a patient's choice of doctors and hospitals. The Foundation for Taxpayer and Consumer Rights (FTCR) ... sharply criticized the move because such a plan will severely limit patient access to care and unfairly places the burden of rising health care costs on patients and employers." (The Foundation for Taxpayer & Consumer Rights)

Links to Items on Executive Comp, Benefits in General

Designers of Executive Salary Plans Fear More Abuses
Excerpt: "George B. Paulin, president of Frederic W. Cook & Company, a leading pay consultant, said that consultants bore part of the responsibility for excesses because they did not fully warn of how stock options, restricted stock and other devices could be exploited by executives. He said the focus now should be on adopting the best practices to make sure shareholders do not pay more than necessary for executive talent." (New York Times; free registration required)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad

Benefits Paralegal/ERISA Specialist
for Florida Power & Light Company
in FL

401(k) / Pension Administrator
for Benetech, Inc.
in CA

Employee Benefit Paralegal
for Scialabba & Morrison, PC
in NJ

Benefits Clerk
for The Segal Company
in DC

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