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October 21, 2004
Today's sponsor: World Congress
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The 2nd Annual WORLD HEALTH CARE CONGRESS January 30 – February 1, 2005 ~ Washington DC ~ Marriott Wardman Park Hotel The 2nd Annual 2005 World Health Care Congress is the most progressive forum to achieve an affordable, accountable U.S. health care system. Co-sponsored by the Wall Street Journal and CNBC, the 2004 executive conference initiated a dialog of national significance. The 2005 conference achieves significant strides in implementing actionable solutions as it will convene all stakeholders - over 1500 CEOs, senior executives and government officials from the nation’s largest employers, hospitals, health systems, health plans, pharmaceutical and leading government officials.
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Insurance Company Probe Causes Some Major Insurers to Stop Contingency Fees
Excerpt: "New York Attorney General Eliot Spitzer's extensive probe into the insurance industry has prompted two major insurers, Ace Ltd. and American International Group Inc., and ... Marsh & McLennan Cos., to end the practice of contingency fees. These fees, also known as placement service agreements or market service agreements, are based on the volume and profitability of business brokerages steer to insurers and are in addition to regular commissions brokers receive." (BenefitNews Connect)
Insurance Company Probe Widens, Marsh Reportedly Suspends Workers
Excerpt: "California Insurance Commissioner John Garamendi also said he expects the investigation to widen beyond the property and casualty lines targeted in a suit filed last week by New York Attorney General Eliot Spitzer alleging price fixing and bid rigging. These could include life and health policies as well as auto and home insurance." (Wall Street Journal via SFGate.com)
Marsh & McLennan's Directors and Top Executives Used Partnerships for Private Profits, New York Times Says
Excerpt: "Board members and senior executives of Marsh & McLennan, the giant insurance broker that has been accused of cheating customers, put millions of dollars into a partnership that profited by buying companies from Marsh and investing in companies that work with Marsh. Jeffrey W. Greenberg, the chairman and chief executive of Marsh, is among the largest individual investors in the partnership, which Marsh created in 1999 to invest in insurance and financial services companies." (The New York Times; one-time registration required)
States Increase Their Scrutiny of Insurance Brokers and Plan to File Lawsuits
Excerpt: "The California insurance regulator is preparing lawsuits against several national insurance brokers and companies, people close to the insurance department said yesterday, .... The lawsuits are expected to focus on brokers and insurers who deal in employee benefits such as group life and disability coverage as well as property casualty insurance purchased by national and regional corporations. Other types of insurance companies may also be included in the legal action." (The New York Times; one-time registration required)
Analysis: Discretionary Clauses in Disability Insurance Policies Ruled Illegal in California (PDF)
Pages 1-2 of 8 page PDF. Excerpt: "The California Department of Insurance and a federal district court have both recently held that the use of so called 'discretionary clauses' in disability insurance policies, including those issued to plans governed by ERISA, violates California law and that the state law in this regard is not preempted by ERISA." (Trucker Huss)
BlueCross BlueShield of Tennessee Offers Free Trial Period on Generic Medicines to Insured
Excerpt: "Generic pres.cription drugs already cost less than name-brand medications, but for the next two months, they will be free for many Tennesseans insured by BlueCross BlueShield of Tennessee. Between now and Dec. 31, the Chattanooga-based insurance company is doing away with copayments when its customers fill their pres.criptions with generic drugs." (The Tennessean)
Poor and Uninsured Don't Fill Emergency Rooms; Most Treated are Covered by Insurance
Excerpt: "A new study on emergency rooms disputes the common wisdom that the poor and uninsured are overwhelming ERs. In fact, more than 80% of patients seen in emergency rooms have health insurance and a usual source of health care such as a primary care physician, investigators reported on Tuesday." (Reuters via Medscape)
The Changing Role of America's Pharmacists in the Health Care Industry
Excerpt: "Managing disease through medication is a concept embodied in the new Medicare pres.cription drug benefit slated to take effect in 2006. Under the law, health plans that offer a Medicare Part D benefit must offer so-called 'medication therapy management services.' By ensuring that beneficiaries who have multiple chronic diseases take their medications appropriately, pharmacists expect to play a critical role in the care of older Americans." (HealthDay via Yahoo! News)
Flu Vaccine Shortage Prompts Formulary Changes, As Insurers Watch Medical Costs
Excerpt: "Managed care plans have placed an increasing emphasis on flu vaccines to reduce costs and improve health status among enrollees susceptible to influenza and related ailments. But the shortage of vaccine this year means that rather than fostering flu vaccine programs, health insurers are scrambling to put alternative plans in place -- and bracing for higher spending on flu-related illnesses." (AISHealth.com)
Senior HMOs Rev Back Up As More Federal Money Allows Private Medicare to Offer More Than Before
Excerpt: "Private Medicare managed-care plans, which burst into North Carolina and across the nation in the 1990s and then abruptly stalled after many plans lost money, are starting to show signs of life. This year Partners, a Medicare HMO run by Blue Cross and Blue Shield of North Carolina, cut its monthly premiums by more than 30 percent and reduced members' out-of-pocket costs for outpatient surgery, pres.cription drugs and hospitalizations." (The News & Observer Publishing Company)
Analysis of Recent Guidance on Health Savings Accounts (PDF)
Pages 3-6 of 8 page PDF. Excerpt: "Since HSAs were introduced, the Internal Revenue Service and the Department of the Treasury have issued a flurry of substantive guidance to help individuals, plan sponsors, and service providers understand how HSAs may be established and operated." (Truck Huss)
Links to Items on Executive Comp, Benefits in General
The Real Consequences for Companies of Pension Fund Return and Health Cost Projections
Excerpt: "Analysts have repeatedly criticized companies with pension plans for using assumptions that appear too optimistic given current financial conditions. Those who follow the auto industry said yesterday that the automakers' accounting practices were not out of the norm for corporate America; however, the regulators appear to be reviewing whether the standard practices themselves are appropriate." (The New York Times; one-time registration required)
Analysis: Congress Approves Changes to the Tax Rules for Nonqualified Deferred Compensation Plans (PDF)
14 pages. Excerpt: "These changes are not limited to just traditional salary and bonus deferral programs. The new rules affect supplemental executive retirement plans (SERPs), statutory restoration plans, equity-based compensation arrangements such as stock appreciation rights (SARs) and restricted stock units (RSUs), long-term incentive plans and directors' fee deferral programs." (McDermott Will & Emery)
Opinion: Congress Revisits 'Bridge on the River Kwai' with Nonqualified Deferred Compensation Change
Excerpt: "The U.S. Congress has decided to meddle once again in the world of executive compensation. Some of what it has done in the American Jobs Creation Act of 2004 is good. Some of it is awful. Most of the pay aspects of the new law are aimed at limiting the ability of an executive to defer his salary, bonus or other incentive payments to some future year." (Graef Crystal via Bloomberg.com)
CEO and Outside Director Pay Rises in All Industries According to Annual Compensation Studies
Excerpt: "Median total compensation for outside (non-employee) directors of U.S. boards is higher than last year's median in all three major industry sectors covered in The Conference Board's annual study of outside director pay. The study is based on a survey of directors' compensation and board practices in 510 companies. The oversight role of corporate boards is intensifying, resulting in significantly higher demands on board members." (The Conference Board)
U.S. Labor Dept. Extends Annual Reports Deadline After Tropical Storm Frances Hits South Carolina
Excerpt: "The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) [on October 19, 2004] announced an extension of the deadline for filing Form 5500 and Form 5500 EZ annual report/returns due to damages from tropical storm Frances in South Carolina." (U.S. Department of Labor, Employee Benefits Security Administration)
U.S. Labor Dept. Extends Annual Reports Deadline After Tropical Depression Ivan Hits New York
Excerpt: "The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) [on October 19, 2004] announced an extension of the deadline for filing Form 5500 and Form 5500 EZ annual report/returns due to storm damages from tropical depression Ivan in New York." (U.S. Department of Labor, Employee Benefits Security Administration)
U.S. Labor Dept. Extends Annual Reports Deadline After Tropical Depression Ivan Hits New Jersey
Excerpt: "The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) [on October 19, 2004] announced an extension of the deadline for filing Form 5500 and Form 5500 EZ annual report/returns due to storm damages from tropical depression Ivan in New Jersey." (U.S. Department of Labor, Employee Benefits Security Administration)
U.S. Labor Dept. Extends Annual Reports Deadline After Severe Storms and Flooding Hit Minnesota
Excerpt: "The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) [on October 19, 2004] announced an extension of the deadline for filing Form 5500 and Form 5500 EZ annual report/returns due to damages from severe storms and flooding in Minnesota." (U.S. Department of Labor, Employee Benefits Security Administration)
Treasury/IRS Officials Discuss How Various Legislation Will Affect Employee Benefit Plan Guidance
Excerpt: "A panel of key Treasury Department and IRS officials reviewed anticipated new guidance in light of pending and enacted legislation at an [ALI-ABA] conference on October 8, 2004. The conference, 'Current Treasury and IRS Issues: Treasury Update; Important Legislative Developments; Current Issues; New Regulations; Rulings, and Other Guidance' featured Marjorie Hoffman, Robert Misner, Monika Templeman and Martin Pippens ... and William Sweetnam, Jr. ...." (CCH Pension & Benefits News)
Overview: FASB Decides on Effective Date for Option Expensing (PDF)
4 pages. Excerpt: "The Financial Accounting Standards Board (FASB) made several important tentative decisions over the last week in regard to the effective date for its project on expensing employee equity based compensation. Mandatory stock option expensing for public companies would commence on a 'modified prospective' basis for quarterly reporting periods beginning after June 15, 2005, and for annual reports including those affected quarters." (Frederic W. Cook & Co., Inc.)
Newly Posted Events
Automatic Rollovers & Lost Participants Web Seminar
Nationwide on November 2, 2004
presented by SunGard Corbel
Wellness Fair
in Massachusetts on November 17, 2004
presented by Worldwide Employee Benefits Network (WEB)
Newly Posted Press Releases
The SPARK Institute Meets With SEC To Outline Technology Enhancement To The SPARK Solution Alternative To “Hard 4 P.M.” Close
(RG Wuelfing & Associates)
Newly Posted or Renewed Job Openings
401(k)/Defined Contribution or Defined Benefit Compliance Analyst
for National Retirement Services, Inc.
in
Client Services Central Regional Manager
for Transamerica
in IL
Administrative Assistant - 401k
for Qualified Benefits, Inc.
in CA
Account Executive - Client Relationship Management
for Diversified Investment Advisors
in MA
Pension Administrator
for The Pension Service, LLC
in MA
Benefits and Employee Service Center Manager -Benefits
for Ochsner Clinic Foundation
in LA
Project Manager - Health Programs
for Kohler Co.
in WI
Account Administrator
for Fortress Retirement Services, Inc.
in IA
Actuary
for MassMutual Financial Group
in MA
Retirement Services Director - Sales
for CitiStreet
in CA, WA
Senior Product Manager
for National City
in OH
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