February 19, 2003 - 8,053 subscribers Today's sponsor: Thompson Publishing Group Inc. (Click on company name or banner to learn more.) See Why Thousands of Benefits Administrators turn to the Guide for Compliance Do all your HR and benefits staffers know what they must do to protect the privacy of employees' medical records? If they don't, they need to --and soon. The EMPLOYER'S GUIDE TO HIPAA PRIVACY REQUIREMENTS is the ONLY comprehensive, continuously updated publication that's guaranteed to help employers tackle HIPAA's complex medical privacy rules. See why thousands of your colleagues turn to the GUIDE in designing and running their HIPAA compliance programs. Try the GUIDE risk free ... Click above. (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) HIPAA Security Requirements Excerpt: "HIPAA's administrative simplification provisions establish standards for electronic transactions and unique identifiers, as well as for ensuring the privacy and security of individuals' personal health information. 'Privacy' generally refers to the right of individuals to control disclosure and use of their personal information. 'Security' includes the physical, administrative, and technical safeguards to protect the integrity and access to information." (Healthplan via Medscape; one-time registration required) Analysis & Comments On HHS's Just-Released HIPAA Security Rules Excerpt: "One area of vast improvement is the final security rules' explicit recognition that the cost of implementing security is a factor in security decisions (and, presumably, in regulatory and judicial judgments about security issues). The entire health care industry benefits from this dose of realism ..." (Davis Wright Tremaine LLP) IT Industry Insiders Say Don't Bother with HIPAA Certifications Excerpt: "While consultants have seen the Health Insurance Portability and Accountability Act (HIPAA) as a potential bright spot during the past few years, several experts we contacted cast doubt on the value of HIPAA-related certifications." (Tech Republic; one-time registration required) Law Firms Embrace Pre-Tax Benefit Offerings Excerpt: "As companies reassessed benefit offerings for 2003, a trend emerged in the legal field that seemed to contradict national developments. Many of this country's top law firms flocked to a new genre of pretax health, dependent care and commuter benefits in spite of a growing movement to scale back on such packages." (BenefitNews.com) Law Firm Marketer Touts 'Millions of Dollars to the Law Firms We Represent' in Drug Litigation Excerpt: "Call us about generating business for Prempro, Vioxx, Serzone, Meridia, Propulsid, PPA, Lotronex, Ephedra, Primary Pulmonary Hypertension, Baycol, Rezulin, Oxycontin, Arava and more..." (Wingtip Communications) State Labor Legislation Enacted In 2002 January 2003 issue of the Monthly Labor Review Online. Excerpt: "Mininum wage rate increases, limits on overtime for nurses, paid family and medical leave, workplace security, and military re-employment rights were among major legislation enacted during the year." (Bureau of Labor Statistics, U.S. Department of Labor) AHRQ Announces New Web-Based Medical Journal with Patient Safety Lessons Excerpt: "The Agency for Healthcare Research and Quality launched a monthly peer-reviewed, Web-based medical journal that showcases patient safety lessons drawn from actual cases of medical errors. Called AHRQ WebM&M (Morbidity and Mortality Rounds on the Web), the Web-based journal (http://webmm.ahrq.gov) was developed to educate health care providers about medical errors in a blame-free environment." (Agency for Healthcare Research and Quality) Why Spy on Employees' Web Use? Excerpt: "If you don't want your people missing work to take care of personal business, maybe it would be better to let them take care of some of that business at work. Losing a few minutes here or there-- or even a couple of hours-- is cheaper than losing entire days. Other unintended consequences of electronic monitoring are more difficult to measure but potentially worse for business." (Business 2.0) HMOs Generally Deny Care for Optional, Not Crucial Treatments, Study Says Excerpt: "Disputes between HMOs and members over denials of care are more likely to occur regarding coverage of elective procedures, such as liposuction or varicose vein removal, than over medical treatment with 'direct health consequences,' according to a study in the Journal of the American Medical Association, the Wall Street Journal reports." (KaiserNetwork.org) Study: Many HMO Disputes Are Minor Excerpt: "Most patient-HMO disputes involve patients seeking physicians outside of their networks and questions over which services are covered, new research revealed Tuesday." (United Press International) How Are Health Plans Supporting Physician Practice? Excerpt: "A different look at how health plans are managing patient care from the viewpoint of physicians.... How widely are the tools that could support physician practice and care improvement being used by health plans? Are they being implemented effectively? We address these questions from the perspective of physicians who contract with health plans." (Health Affairs via Medscape; one-time registration required) White Paper: Key Factors Affecting Affordability of Prescription Drugs Excerpt: "Year after year, the pharmaceutical industry is the country's most profitable industry, at a time when many consumers are unable to afford its products. U.S. consumers are paying high and escalating prices for their prescriptions, and are facing higher out-of-pocket expenditures as insurers (and employers) increase their cost-sharing." (Consumers Union) Health Insurance Association Says AHPs Cause More Harm Than Good Press release. Excerpt: "We are concerned that the preferential treatment of AHPs with respect to state-mandated benefits and rating restrictions will create a two-tiered marketplace for small business owners, almost certainly resulting in a migration of small employers, particularly healthier groups, out of the general small group market into AHPs." (Health Insurance Association of America) Health Spending Projections For 2002-2012 Excerpt: "We forecast a slowdown in national health spending growth in 2002 and 2003, reflecting slower projected Medicare and private personal health spending growth. These factors outweigh higher projected Medicaid spending growth, caused by weak labor markets, and an expectation of continued high private health insurance premium inflation related to the underwriting cycle. Over the entire projection period, national health spending growth is still expected to outpace economic growth." (Health Affairs) Two Trends in Health Insurance Coverage This Fall 2002 publication describes certain recent economic research. Excerpt: "The 1980s and 1990s were marked by two concurrent trends in employer-provided health insurance: a significant decrease in the fraction of workers receiving insurance through their employers and a sharp increase in the insurance premiums paid by workers. These trends and the possible link between them are explored in two new NBER studies." (National Bureau of Economic Research) Milwaukee Business Coalition Considers Healthcare Fee Schedules Excerpt: "In what could prove to be a fundamental shift in who determines health care costs, Milwaukee area businesses are working to set limits on what they will pay for common medical procedures.... Instead of hospitals telling businesses what prices they will accept for procedures, under a fee schedule, businesses would tell hospitals what they will pay." (The Milwaukee Journal Sentinel) Medical Errors Come Home Excerpt: "[A] new study examining the largely overlooked problem of errors that don't appear until patients get home has concluded that the transition from hospital to home may be a source of errors that are more numerous, though less deadly, than mistakes made in hospitals." (Washington Post) Cutting Down on Claims: Finding the Sickest HMO Participants Excerpt: "[A] small percentage of patients, usually less than 10 percent, [accounts] for more than half of the number of claims. Now, health insurers are using those same numbers to determine who has the potential to fall into that high-risk group. Their intended result? Healthier members and fewer claims." (Dayton Business Journal via bizjournals.com; one-time registration required) Kaiser Foundation Report: How Much Do We Already Spend on the Uninsured, and Who Pays for It? Excerpt: "'This report demonstrates that we are already paying a substantial amount to care for a large uninsured population without a guarantee of coverage. The implication is that we pay for care in the least efficient way possible-- after people get sick and need emergency or hospital care,' said Diane Rowland, executive director of KCMU." (Kaiser Commission on Medicaid and the Uninsured, Henry J. Kaiser Family Foundation) How Much Medical Care Do the Uninsured Use, and Who Pays For It? Excerpt: "This information is essential for assessing how much new money will be required for expanded coverage, how much can be reallocated from existing sources, and how a new financing system would redistribute the burden of subsidizing care for the uninsured from private to public sources." (Health Affairs) Links to Items on Executive Comp, Benefits in General Another Question is Answered in the Stock Options, Restricted Stock and Other Long-Term Employment Incentives Q&A Column Question: I was granted 3,750 non-incentive stock options at hire for $6.50/share. The stock is now trading at $10/share. According to my agreement I am able to exercise 1/4 of these options in 3/03, then 1/4 in 9/03, then 1/4 in 9/04 and 1/4 in 9/05. My question is, how do I exercise the first quarter in March, and can this be done as a cashless transaction? Also, will I be paying any tax on this for tax year 2003? (BenefitsLink.com) Full Text: Joint Committee on Taxation Report on Enron Tax and Compensation Issues (PDF) 745 pages (!) Excerpt: "The specific qualified plan issues addressed ... are: (1) the phase out of the ESOP offset under the Enron Retirement Plan; (2) the conversion of the Enron Retirement Plan into the Enron Cash Balance Plan; (3) investment of the ESOP in Enron stock; (4) a change in recordkeeper under the Enron Savings Plan shortly before the bankruptcy that resulted in a blackout period during which investment changes could not be made, including selling Enron stock ..." (Joint Committee on Taxation, U.S. Congress) Materials Available from Recent Conference: Employee Benefits Update for 2003 Conference was held on February 11, 2003; details at http://www.abanet.org/cle/programs/s03ebu1.pdf - Excerpt: "Top officials from the Internal Revenue Service, the Treasury Department, the Labor Department, the Pension Benefit Guaranty Corporation, the Department of Health and Human Services, and the Equal Employment Opportunity Commission, together with experienced practitioners discuss what these new developments mean to employers, plan administrators, and participants." (Joint Committee on Employee Benefits, American Bar Association) Commentary: At Enron, the Compensation Kept Paying Excerpt: "Not only did the company manage to pay its executives -- some 200 of them-- $1.4 billion in 2000, but it used those payments to wipe out nearly all of its tax liabilities that year. And it did so by using perfectly ordinary and widely used devices, the kind employed by almost every large corporation." (Albert Crenshaw in the Washington Post) Mercer Submits Comments to FASB On Stock Option Expensing Excerpt: "We support a safe harbor approach that would treat as noncompensatory all broad-based, tax-favored equity plans, such as Section 423 plans in the US and Save-As-You-Earn plans in the UK.... We support a standard that would permit more flexibility in determining valuation approaches. Specifically, companies should be permitted to select the type of option pricing model that can most reliably measure the value of their employee stock options." (Mercer Human Resource Consulting) Ernst & Young Turnaround on Stock Options Irritates Technology Firms Excerpt: "Some of Silicon Valley's largest technology companies are disappointed that accounting firm Ernst & Young flip-flopped its opinion on expensing employee stock options, but none appears upset enough to start looking for a new accounting firm." (SmartPros) Option Math: Why So Many to So Few? Excerpt: "Among corporate executives, there are wealth spreaders and wealth hoarders. The spreaders disperse millions of stock options among their employees, not just to top executives, allowing many to benefit when the company's stock rises. Spreaders remain very much in the minority ..." (New York Times; one-time registration required) Newly Posted or Renewed Job Openings Implementation Specialist for The Paragon Consulting Group in VA Pension/401(k) Plan Administrator for First Actuarial Corporation in CA Researcher Needed: Regulation and Supervision of Conflict of Interest Concerns in Pension Funds for Organisation for Economic Co-operation and Development (OECD) in ALL STATES Trust/EB Administrator for Glenview State Bank in IL, IN, WI Defined Benefit/Defined Contribution Account Manager for National Retirement Services, Inc. in NC Newly Posted Conferences (Post Yours!) Introduction to ESOPs in TN April 9, 2003 National Center for Employee Ownership Introduction to ESOPs in WI April 8, 2003 National Center for Employee Ownership Introduction to ESOPs in CA May 6, 2003 National Center for Employee Ownership Introduction to ESOPs in CA May 13, 2003 National Center for Employee Ownership Putting Your Retirement House in Order: How to Maximize Value and Reduce Risks in ALL STATES February 26, 2003 Hewitt Associates Introduction to ESOPs in CA May 15, 2003 National Center for Employee Ownership Introduction to ESOPs in OR May 20, 2003 National Center for Employee Ownership Introduction to ESOPs in WA May 21, 2003 National Center for Employee Ownership Handy Links:
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