| BenefitsLink Welfare Plans Newsletter |   |
October 28, 2004
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Aon Could See Lawsuit, Marsh Faces ERISA Class-Action
Excerpt: "Despite having eliminated its contingency commissions practices, ... Aon may unable to escape [NT] State Attorney General Eliot Spitzer. According to the New York Times, investigators have found evidence of deceptive and coercive practices at Aon and may bring a civil lawsuit within the next couple of weeks. While Aon's brokers do not appear to have rigged bids or fixed prices, as Marsh is alleged to have done, they may have threatened to curtail sales of insurers' products ...." (The Adviser)
Overview of Fall-Out from Spitzer Investigation of Marsh & McLennon
Excerpt: "As the financial industry suffers yet another black eye from Elliott Spitzer's investigation of Marsh's insurance brokerage unit, it's worthwhile speculating how the fall-out could affect the retirement industry. Marsh is accused of rigging bids on insurance RFPs to keep prices artificially high while rewarding those insurance carriers paying placement fees and the largest over-ride commissions. Of Marsh's 2003 $1.5 billion in profit, $800 million came from these fees and commissions." (Fred Barstein via 401kExchange.com)
Appeals Court Affirms Health Insurance Coverage Denial for Gastric Bypass Surgery
Excerpt: "An appeals court held that a multiemployer health and welfare fund was justified in rejecting a participant's request to cover his gastric bypass surgery. For treating obesity, the procedure was listed as a 'cosmetic exclusion' under the plan, but the participant argued that it should be covered to treat his obesity-related medical conditions.' Link to full text of Manny v. Central States, SE and SW Areas Pension and Health and Welfare Funds (7th Cir., 10/26/04) is on target page. (Mercer Human Resource Consulting)
Disability Leave Is Higher Among Health Care Employees
Excerpt: "Health care workers could be a particularly lucrative market for brokers selling disability programs. According to a new UnumProvident study, medical sector employees are disproportionately affected by illness and injury compared to those outside the industry. The findings show that hospital employees experience non-work-related injuries 17% more and are out on short-term disability 10% longer than all other non-health care workers." (The Adviser)
Marsh-Mercer Merger Will Be Complete January 1, 2005
Excerpt: "Marsh and Mercer are merging benefit practices to create the world's largest employee benefit consultancy, with more than $1 billion in health and benefits revenue, by Jan. 1, 2005. In the United States alone, some 2,500 employees in 73 locations will combine to work with Marsh's small and medium-sized clients and Mercer's large clients primarily to help them juggle their health care costs." (BenefitNews Connect)
Michigan Blues Work With MDs to Improve Care of Patients with Chronic Conditions
Excerpt: "Blue Cross Blue Shield of Michigan says it is taking disease management to the next level by enlisting the help of 10 physician groups to help improve the quality of patient care. For their participation in the Physician Group Incentive Program, the groups -- which represent more than 2,900 physicians -- will receive quarterly financial incentives that can be invested in infrastructure or used to reward individual physicians." (The AIS Report on Blue Cross and Blue Shield Plans via AISHealth.com)
Health Care Fraud Adds Billions to Total Cost of Care
Excerpt: "Statistics from the Center for Medicare and Medicaid Services show that Americans spent more than $1.7 trillion on health care in 2003. Combined with the fact that industry experts estimate that anywhere from 3% to 10% of this total is lost to health care fraud, that would put the minimum amount spent on health care fraud at over $100 million - per day." (Employee Benefit News)
Report: Health Insurance Coverage & Access Trends -- Black, Latino and White Americans, 2001-2003
Excerpt: "Overall health insurance rates changed little among nonelderly black, Latino and white Americans between 2001 and 2003, according to new findings from the Center for Studying Health System Change (HSC). But sources of coverage shifted--especially for Latinos--from employment-based insurance to public coverage, suggesting the economic downturn took a greater toll on Latinos. Low-income Latinos and whites were particularly hard hit by declines in employer coverage." (Center for Studying Health System Change)
Blue Cross and Blue Shield of Montana Workers Revolt Over Health Benefits Cost Increase
Excerpt: "After a firestorm of criticism from employees, the president of Blue Cross and Blue Shield of Montana this week retracted a message he sent to employees six days earlier announcing they would face higher health insurance costs for the upcoming year. Peter Babin, president and chief executive officer of the company, sent an e-mail to company employees Tuesday telling employees he was pulling back the e-mail he sent Oct. 20 that announced the increases in their health care costs." (Independent Record)
A New Way to Save on Health Insurance Premiums -- a High-Deductible Policy Plus an HSA
Excerpt: "Looking for relief from soaring health-insurance costs? You just might find it this fall as more employers -- including the federal government -- begin offering a new choice: a high-deductible policy tied to a health savings account (HSA). The high-deductible policy will cut your monthly premiums while the savings account will cut your taxes." (Kiplinger.com)
Public Attitudes on the U.S. Health Care System: Findings from the 2004 Health Confidence Survey (PDF)
12 pages. Excerpt: "This Issue Brief presents the findings from the 2004 Health Confidence Survey (HCS), which focuses on Americans' satisfaction with the health care system today and their confidence in the system's future. It examines Americans' attitudes about employment-based health benefits, health savings accounts (HSAs), and benefits in the work place. The Issue Brief also looks at long-term trends in satisfaction and confidence with the health care system ...." (Employee Benefit Research Institute)
There Are Some Similarities That Could Indicate the Shape of Post-Election Health Care Reform
Excerpt: "Experts sorting through the respective health-care proposals being put up by Bush and Kerry say both plans would put a dent in the number of uninsured. Kerry wants to dramatically expand government's role in providing insurance to the uninsured, primarily by expansion of the Medicaid program. Bush has been talking more about health savings accounts on the campaign trail. What both candidates agree on is that the paper-based health system in America needs a technology upgrade." (Workforce Management)
Interview: Treasury Officials Give Behind-Scenes Look at Latest HSA Guidance
Excerpt: "On July 23, the Treasury Dept. issued what will likely be its final round of formal guidance about health savings accounts (HSAs). Since President Bush signed the Medicare reform legislation that led to the creation of HSAs, Roy Ramthun and William Sweetnam, both officials with the Treasury Dept., have been instrumental in interpreting the intent of the law and issuing guidance. In a telephone interview, ICDC asked them about the new guidance and what it took to get it out the door." (INSIDE CONSUMER-DIRECTED CARE via AISHealth.com)
Interest in HSAs Booms Among Brokers; Employers Are Slower to Adopt
Excerpt: "Insurance agents and brokers who spoke with AIS say they're seeing enormous interest in health savings account (HSA)-based plans among their clients, particularly small employers. Adoption of the plans, however, is slow albeit steady. Small employers that typically offer just one health plan seem to favor the HSA model over CDH plans that include a health reimbursement arrangement (HRA), says Don Brain, CEO of Corporate Benefits Consulting, LLC," (INSIDE CONSUMER-DIRECTED CARE via AISHealth.com)
CBO's Analysis of Regional Preferred Provider Organizations Under the Medicare Modernization Act (PDF)
34 pages. Excerpt: "The Medicare Pres.cription Drug, Improvement, and Modernization Act of 2003 (MMA) made many changes to the Medicare program, including changes that increased the incentives for preferred provider organizations (PPOs) to serve broad regions of the country. About 13 percent of Medicare's 42 million beneficiaries currently are enrolled in private health plans; nearly all of those beneficiaries are in health maintenance organizations that primarily serve metropolitan areas." (Congressional Budget Office)
Links to Items on Executive Comp, Benefits in General
US Airways: Court OKs Trimming Benefits and 18% Pay Cut for Pilots
Excerpt: "A judge on Tuesday approved a deal in which US Airways Group Inc. will cut pilot pay 18 percent and trim benefits to save $1.85 billion over five years and help exit bankrup.tcy protection. U.S. Bankrup.tcy Judge Stephen S. Mitchell also approved concession plans agreed to by three employee groups represented by the Transport Workers Union to provide savings of $6.6 million a year. The pilots ratified their givebacks last week." (Bloomberg News via Chicago Tribune; one-time registration required)
Delta Pilots Say Deal Is Done on Pay Concessions and Benefit Changes
Excerpt: "Leaders of Delta Air Lines' ... pilots union have approved a tentative package of concessions and will send it to ... members for a vote. The deal provides a 32.5% wage reduction from May 2004 levels, effective Dec. 1, with no increases for five years. It will also freeze the pilots' defined benefit retirement plan and give them a new defined contribution plan. Pilots will also receive about 30 million shares of Delta common stock, representing a 15% equity stake in the company." (TheStreet.com)
Hewitt Federal Legislation Quick Guide Updated October 26, 2004
Excerpt: "Hewitt's Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding health and welfare benefit plans, retirement plans, and human resources and employment law." (Hewitt Associates)
Full Text of the Autumn 2004 "Compass" Published by Aon Consulting in the United Kingdom
8 pages. This quarterly edition contains the following articles: The Role of Hedging in Pension Funds, Flexible Benefits – A False Dawn or Some Real Action?, Expensing Share Options A New Challenge for Finance Directors, and Online Pensions Communications Delivering Benefits to Members and Schemes. (Aon Consulting)
Newly Posted Events
2004 Executive Briefing: New Developments in Business Succession Planning and ESOPs
in Massachusetts on December 2, 2004
presented by McDermott Will & Emery LLP
2005 Spring Conference
in California on May 19, 2005
presented by Western Pension & Benefits Conference - Orange County Chapter
Employer Securities in Retirement Plans - Opportunities and Issues
in California on February 17, 2005
presented by Western Pension & Benefits Conference - Orange County Chapter
How Healthy Are Your Health & Welfare Plans?
in California on November 18, 2004
presented by Western Pension & Benefits Conference - Orange County Chapter
Plan Disclosure & Communication
in California on March 17, 2005
presented by Western Pension & Benefits Conference - Orange County Chapter
Plan Governance in Light of Enron Litigation Results
in California on December 9, 2004
presented by Western Pension & Benefits Conference - Orange County Chapter
Rollovers, Distributions & Orphan Plans
in California on April 21, 2005
presented by Western Pension & Benefits Conference - Orange County Chapter
Newly Posted Press Releases
Employease Selected for Forbes 'Best of the Web' for Third Time
(Employease)
ERISA Advisory Council to Hold Final 2004 Meetings
(U.S. Department of Labor, Office of Public Affairs, Washington, D.C.)
ForYourFinancialHealth.com Demystifies Health Care Spending Accounts; WageWorks Launches Web Site to Help Consumers Understand FSAs and HSAs
(WageWorks Inc.)
Newly Posted or Renewed Job Openings
Senior Associate
for Pension Services Corporation
in MO
Human Resources Generalist
for AICPCU
in PA
Defined Benefits Quality Assurance Mgr.
for Hewitt Associates
in NJ
Benefits Compliance Manager
for Hewitt Associates
in IL
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