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Welfare Plans
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November 14, 2002 - 7,973 subscribers
Today's sponsor: EBIA's ERISA Compliance for Health & Welfare Plans

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   ERISA Compliance for Health & Welfare Plans is an authoritative
   resource for employers, administrators and advisors. Written by
   leading employee benefits attorneys, this manual has all the
   information you need to bring your welfare benefit plans into
   compliance with ERISA.

   Click above to learn more about this valuable treatise,
   which is always kept current through periodic updates.

(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay your way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)
A Multifaceted Treatment Regime for Managing Rampant Rx Costs (PDF)
4 pages. Nice sketch of some strategies, including: Partnering with PBMs; Educating Employees to Counterbalance Direct-to-Consumer Advertising; Sharing the Financial Burden in New Ways; Providing an Incentive to Use Mail Order Pharmacies; Paying Attention to Program Features. (The Segal Company)

Health Plans Increase Web-Based Service Offerings
Excerpt: "[M]anaged care organizations continue to increase the number of Web-based features they offer their members, according to a survey from Cap Gemini Ernst & Young. The biggest change has allowed members to order prescription drugs online, with almost half of health plans offering the service, up from 14% in March." (iHealthBeat.com; free registration required)

Insurer Improperly Denied LTD Benefits Based On Preexisting Condition Exclusion: Court
An insurer's decision to deny long term disability benefits based on a preexisting condition exclusion was unsupported by evidence and therefore was an abuse of discretion. This was the decision of the Third Circuit U.S. Court of Appeals in Ceccanecchio v. Continental Casualty Company (No. 01-4468). (SpencerNet)

Lawsuit Says Merck, Merck-Medco Steered West Virginia State Employees to Costlier Medications
Excerpt: "West Virginia Attorney General Darrell McGraw (D) has filed suit against Merck and its pharmacy benefit manager subsidiary Medco Health Solutions on allegations that Merck and Medco 'steered' state employees to more expensive treatments -- which included Merck products -- and withheld pharmaceutical company rebates that the state should have received, the Wall Street Journal reports." (KaiserNetwork.org)

Federal Government Should Block Drug Companies' Efforts To Prevent Formularies, Columnist Says
Excerpt: "The federal government should move to stop the pharmaceutical industry from blocking states' implementation of preferred drug lists to reduce health care costs, Joel Gurin, executive vice president of Consumers Union, publisher of Consumer Reports, writes in a USA Today opinion piece." (KaiserNetwork.org)

Health Plans Consider Bringing Pharmacy Functions in-House
Excerpt: "Some health plans think they can do a better job of managing pharmacy benefits than niche companies that specialize in the task. The do-it-yourself camp is small, to be sure, and unlikely to pose an imminent danger to the giant pharmacy benefit management (PBM) industry." (Medscape; free registration required)

Opinion: the Era of Big Government Health Reform Is Over
Excerpt: "Tuesday's election results show that, in race after race, voters supported candidates who advanced fresh ideas for market-based health reform and defeated those who advocated more and bigger government-run programs." (The Galen Institute)

New HIPAA Bulletins Address How Association Plans Should Deal With Guaranteed Availability
The Centers for Medicare and Medicaid Services (CMS) has issued the third and fourth in a series of bulletins concerning the application of the Health Insurance Portability and Accountability Act to health care plans provided by associations. The two latest bulletins concern the relationship between associations and HIPAA requirements regarding guaranteed availability and guaranteed renewability. (SpencerNet)

Links to Items on Executive Comp, Benefits in General

DOL Issues Field Assistance Bulletin 2002-2 on Plan Amendments by Multiemployer Plan Trustees
Excerpt: "[W]here relevant documents ... contemplate that the board of trustees of a multi-employer plan will act as fiduciaries in carrying out activities which would otherwise be settlor in nature, such activities would be governed by the fiduciary provisions of ERISA.... [But if] the relevant plan documents are silent, then the activities of the board of trustees which are settlor in nature generally ... would not be fiduciary activities subject to Title I of ERISA." (U.S. Department of Labor, Pension and Welfare Benefits Administration)

Joint Committee on Taxation Describes Tax Technical Corrections Act of 2002 (PDF)
8 pages. Excerpt: "The bill was introduced on November 13, 2002, as H.R. 5713 in the House of Representatives and S. 3153 in the Senate.... [JCWAA 2002:] Exclusion for employer-provided adoption assistance.... Interest rate for defined benefit plan funding requirements.... [EGTRRA:] Rounding rule for retirement plan benefit and contribution limits.... SIMPLE plan contributions for domestic or similar workers...." (U.S. Congress, Joint Committee on Taxation)

Expensing Stock Options Should Cause Rethinking of Their Role and Value in Compensation Plans
Excerpt: "HR executives should ask, 'What are we trying to do with this incentive program? Retain employees? Attract employees? Focus employees on meeting financial and non-financial objectives? Trying to build stock ownership across employees? Better align employees' interests with shareholders' interests? Recognize top performers?' Depending on how those questions are answered, stock options may or may not be the answer ... and how they are awarded and the size of the grants may vary." (HR Magazine)

Tech Firms Try To Preempt New Stock Option Accounting Rules
Excerpt: "A coalition of high-tech companies says it will pledge today [Thurs. Nov. 14, 2002] to disclose more information about stock options in an urgent bid to avoid proposed accounting rules that would hurt corporate profits." (The Miami Herald)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Actuarial Analyst
for NYLIM Retirement Plan Services
in MA

Qualified Plan Administrator - Valparaiso, Indiana
for Pension Consulting Services, Inc.
in IN

Experienced SunGard OmniPlus Administrator
for Gabriel, Roeder, Smith & Company
in FL

Newly Posted Conferences
(Post Yours!)

Discover2003 Conference
in CO
February 1, 2003

Holiday Reception/Third Annual ACE in Benefits Award Presentation
in GA
December 5, 2002
WEB Atlanta Chapter

DB/DC Overlay Plans
in AZ
November 20, 2002
Western Pension & Benefits Conference - Phoenix Chapter

Fiduciary Risk Management - The Good, The Bad, The Ugly
in AZ
November 21, 2002
Western Pension & Benefits Conference - Phoenix Chapter

Newly Posted Press Releases
(Post Yours!)

SearchPerformance Launches to Meet Fiduciary Demand for 401(k) Plans
(PlanAnalytics, Inc.)

Standard Insurance Company Takes Top Marks in Plan Sponsor Magazine's 2002 Defined Contribution Survey
(Standard Insurance Company)

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Editor and Publisher: David Rhett Baker, J.D.