| BenefitsLink Welfare Plans Newsletter |   |
November 30, 2004
Today's sponsor: William J. Stecker, CPA
(Click on company name or banner to learn more.)
A Practical Guide To Substantially Equal Periodic Payments And Internal Revenue Code §72(t) New 4th edition by William J. Stecker, CPA with all of the updates needed to reflect the issuance of Revenue Ruling 2002-62 in October, 2002 as well as all Private Letter Rulings issued subsequently. This text is a must read for anyone under age 60 who is contemplating early retirement and has substantial 401(k) or IRA assets. This text will teach the reader everything they need to know about avoiding the 10% surtax on early withdrawals as defined in IRC 72(t). All computational methods are covered and how to plan and properly execute substantially equal periodic payments. This is the definitive text on IRS 72(t) including more than 190 footnotes citing all of the relevant legal authorities. Click above to purchase and download now
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
A Time for Flexibility in the Workplace -- Worktime Flexibility
Excerpt: "Flexibility means part-time work, episodic work, job-sharing and general policies that help people manage their private lives. It's a workplace culture that focuses on getting the job done rather than punching time on the clock." (The Washington Post; one-time registration required)
Aggressor's Death Not Accidental If He Could Reasonably Anticipate Injury Resulting in Death
Excerpt: "The court apparently concluded that the language in the insurance policy required interpretation, looking to other court decisions for guidance. Because benefit claim denials are the source of much litigation under ERISA and have produced an increasing number of court decisions interpreting particular benefits provisions, plan sponsors and insurers are not writing on a blank slate when they draft plan language.' Moore v. UNUM Provident Corp., 2004 U.S. App. LEXIS 23685 (4th Cir. 2004) (Employee Benefits Institute of America Inc.)
Benefits Report from Trucker Huss, November 2004 (PDF)
7 pages. This issue includes articles on the Medicare Pres.cription Drug, Improvement and Modernization Act of 2003: Retiree Pres.cription Drug Coverage; The American Jobs Creation Act of 2004: Employee Benefits Related Issues; and, AB 2208 Mandates Insurance Coverage for California Registered Domestic Partners. (Trucker Huss)
California State Rules Complicate Health Savings Accounts
Excerpt: "As if the new health savings accounts weren't complicated enough, employers and individuals who open one in California should arm themselves with a big bottle of aspirin. As I mentioned in last Sunday's column, California has not conformed to the federal tax law that created the accounts. That means they provide fewer tax benefits and more record-keeping headaches for Californians than for residents of states that automatically conform to federal tax legislation." (San Francisco Chronicle)
Council for Affordable Health Insurance Promotes the Health Care Choice Act, H.R. 4662
Excerpt: "Because health insurance is regulated by each individual state, under current law, individuals must buy health insurance coverage in the state in which they live, even if an insurance policy costs much less in a neighboring state. Legislation recently introduced by Rep. John Shadegg (R-AZ) – The Health Care Choice Act (H.R. 4662) – would change that and potentially give consumers access to more affordable health insurance." (Council for Affordable Health Insurance)
Education, Plan Design, Leadership Support Can Boost CDH Enrollment from 5% to 50%
Excerpt: "Consider two companies that introduce an optional CDH plan to their health benefits packages. Although they have identical employee demographics, CDH enrollment at one company tops 50%, while just 5% of employees at the other company opt in. So what happened? Industry experts agree that three factors are critical for high enrollment in an optional CDH plan: continuous employee communication, visible support from senior staff and a plan design that can compete with existing options." (INSIDE CONSUMER-DIRECTED CARE via AISHealth.com)
Group Health Care Cost Increases Fall to Single Digits with the 7.5 Percent Uptick
Excerpt: "Group health-care plan cost increases are slowing dramatically, with the rate of increase in 2004 the lowest in five years. This year, group health costs rose by an average of 7.5 percent, to $6,679 per employee, according to a national survey of more than 3,000 employers released by Mercer Human Resource Consulting in New York. The 2004 cost increase is the lowest since 1999--when costs increased an average of 7.1 percent--and breaks a three-year run of double-digit cost increases." (Business Insurance via Workforce Management Online)
Health Information Technology: Unlocking the Logjam of Cost and Results and Benefits
Excerpt: "Nearly everyone agrees that done well, health IT will save both lives and money. But right now, the technology often costs doctors more than it saves. Insurance companies want more data about how programs save them money, and vendors are having trouble creating and supporting products at affordable rates. John Glaser .... was chair of the group at the highly respected Markle Foundation that concluded that there was no viable business case for outpatient physicians interested in ...." (eWEEK Enterprise News & Reviews)
Medicare Advantage Plans May Have Edge in Offering Part D Drug Coverage Starting in 2006
Excerpt: "[With] the Medicare Pres.cription Drug, Improvement and Modernization Act of 2003 ..., experts warn pres.cription drug coverage will no longer be a defining feature of Medicare HMOs. Yet while Medicare Advantage ... organizations will have to compete with Pres.cription Drug Plans ... in offering at least one plan with a Part D-type pharmacy benefit starting in 2006, [a] consultant ... says MA plans will be the only entities able to use medical cost savings to reduce the Part D premium." (MEDICARE ADVANTAGE NEWS via AISHealth.com)
Mellon Survey Says Health Care Industry Struggles to Hold Down Costs
Excerpt: "A survey released Monday by Mellon Financial Corp.'s Human Resources & Investor Solutions reveals that controlling costs and growing revenues are key strategic problems for the health-care industry. The annual study, entitled '2004 Total Compensation in Integrated Healthcare Systems Survey' and completed in the third quarter, surveyed 60 health-care institutions across the United States, 70 percent of which are multi-hospital systems." (Pittsburgh Business Times via bizjournals.com; one-time registration required)
Merck Offering Top Executives Rich Way Out in Case of a Takeover
Excerpt: "With its stock plunging and its ability to thrive as an independent company uncertain, the drug giant Merck has adopted a plan that could give its top executives big bonuses if the company is taken over. Merck has been reeling since it withdrew its arthritis treatment Vioxx from the market on Sept. 30 after acknowledging that studies have found a higher incidence of heart problems in people taking the drug." (The New York Times; one-time registration required)
More Companies Partying Again: Uncork the Champagne -- Holiday Parties Are in Style Again
Excerpt: "Promising economic signs mean employers are willing to spend once more on year-end parties. It's a reversal from recent years when financial worries killed or curtailed many holiday bashes. The partying spirit is also returning, even though many companies are holding back on costlier outlays, such as year-end bonuses and salary increases. Ninety-five percent of companies are having some type of holiday celebration this year, according to a poll by New York-based Battalia Winston ...." (USA TODAY)
Opinion: Caution Required: Insurers Need to Study Risks, Benefits of Weight-Reduction Surgery
Excerpt: "Ever since NBC's Al Roker lost 115 pounds via gastric-bypass, other obese people have been clamoring for the weight-loss surgery. But at $25,000 a pop, it could break the bank. The cost of operations for the 4.5 million Americans who are at least 100 pounds overweight could exceed $112 billion. Even in a trillion-dollar health care system, that's real money. The caution flag should go up. That's not to say the surgery should end." (Orlando Sentinel)
Opinion: Uncle Pharma's Mischief in a Bottle -- Pharmaceutical Companies vs. the FDA
Excerpt: "A major pharmaceutical CEO gets hauled up in front of Congress to do the congressional version of a perp walk. The executive's company stands accused of one of the worst drug screw-ups in recent history. Meantime, an FDA official, a scientist with an impeccable scientific track record who had managed to predict almost all of the major drug recalls, testifies that the drug should have been targeted for intense study and possible withdrawal up to three years earlier." (Los Angeles Times; one-time registration required)
Overview: 2005 Cost-of-Living Adjustments for HSAs, Transportation Benefits, Adoption Assistance
Excerpt: "The IRS has released the 2005 cost-of-living adjustments to various limits for health savings accounts (HSAs), qualified transportation benefits, and adoption assistance programs, among other benefits. .... The HSA contribution limits and high-deductible health plan (HDHP) requirements (under Code Section 223) will be: Annual HSA contribution limits--$2,650 for self-only HDHP coverage (a $50 increase from 2004) and $5,250 for family HDHP coverage (a $100 increase from 2004)." (Employee Benefits Institute of America Inc.)
Overview: Exposures Not Thinning Popularity of Bariatric Surgery
Excerpt: "As a growing population of obese Americans turns to surgery as a drastic means to shed pounds, hospitals performing these procedures are seeing their liability exposures rise. Hospitals are seeing a surge in demand for bariatric surgery--procedures to treat obesity by reducing the size of the stomach--and a potential financial windfall associated with performing such surgeries. But with more procedures also comes increased medical malpractice risk for the providers and facilities ...." (Business Insurance via Workforce Management)
Overview: IRS Releases 2004 Form 8885 for Claiming Health Coverage Tax Credit
Excerpt: "Because the HCTC was already in effect when HSA legislation was adopted, the HCTC rules did not address whether premiums paid with HSA distributions would be treated the same as those paid with Archer MSA distributions. It certainly makes sense to treat distributions from HSAs and Archer MSAs consistently for purposes of the HCTC, particularly since amounts held in an Archer MSA can be rolled over into an HSA." (Employee Benefits Institute of America Inc.)
Overview: New COBRA Notice and Disclosure Regulations (PDF)
2 pages. Excerpt: "The regulations specify that the plan administrator must provide a notice if COBRA coverage is unavailable for a participant or beneficiary who submitted a request for continuation coverage. This notice of unavailability must be furnished within fourteen days after receipt of the participant's or beneficiary's request, and it must be furnished whenever the plan administrator denies coverage, regardless of whether the request involves a first qualifying event, a second ...." (David J. Kritz via Sutherland Asbill & Brennan LLP)
Plaintiff's Claims Under ERISA, COBRA Were Barred By State Statute of Limitations: Court
Excerpt: "The two-year statute of limitations under state law barred a plaintiff's claims that an employer violated ERISA and COBRA in connection with the employer's termination of the plaintiff's mother. This was the ruling of the Fifth Circuit U.S. Court of Appeals in Lopez v. Premium Auto Acceptance Corporation (No. 03-11264)." (Spencer Benefits Reports)
Protected Health Information Security Safeguards Are Already Required by HIPAA Privacy Rule
Excerpt: "While many covered entities (CEs) are gearing up for the April 2005 effective date for final HIPAA security regulations, a 'mini-security rule' within HIPAA privacy regulations already requires CEs to adopt administrative, technical and physical measures to safeguard protected health information (PHI). What follows is an excerpt from the 'Security and Privacy' chapter of AIS's HIPAA Security Compliance Guide." (REPORT ON PATIENT PRIVACY via AISHealth.com)
Software Defangs COBRA Ahead of Compliance Deadline
Excerpt: "As compliance deadline looms for DOL rules, COBRA software removes administrative sting[.] It took nearly 20 years for two sets of government-issued rules to clear up many ambiguities about how to best administer the Consolidated Omnibus Budget Reconciliation Act of 1985, known as COBRA. But while the grip on employee benefit managers has loosened in the wake of regulatory relief from the U.S. Department of Labor (DOL), the complex benefits law largely retains its venomous sting." (Accounting Software 411)
Links to Items on Executive Comp, Benefits in General
Supreme Court Declines to Hear G.ay Marriage Case
Excerpt: "The Supreme Court on Monday sidestepped a dispute over g.ay marriages, rejecting a challenge to the nation's only law sanctioning such unions. Justices had been asked by conservative groups to overturn the year-old decision by the Massachusetts Supreme Court legalizing g.ay marriage. They declined, without comment." (AP via Yahoo! News)
Temps Lose Bargaining Rights Won in 2000: NLRB Reverses Stand Along Party Lines
Excerpt: "Temporary workers will no longer be able to bargain for job benefits as part of a unit with permanent employees, the National Labor Relations Board has ruled, reversing a Clinton-era precedent. In a 3 to 2 vote that was issued Friday, the three members appointed by President Bush -- Robert J. Battista, the chairman; Peter C. Schaumber and Ronald E. Meisburg -- said there is a difference between temporary and permanent workers." (The Washington Post; one-time registration required)
Overview: Bill with USERRA Rights Notice Requirement Awaiting President's Signature
Excerpt: "A bill that would require employers to provide a notice informing employees of their rights under the Uniform Services Employment and Reemployment Rights Act (USERRA) has been passed by both the U.S. Senate and the House of Representatives and is now awaiting the President's signature. This new federal notice requirement appears in a provision of The Veterans Benefits Improvement Bill of 2004 (S.2486)." (CCH Pension & Benefits News)
Michigan Lawmakers to Target Benefits for Same-Sex Partners
Excerpt: "A state representative said Monday he's working on a measure to oppose health benefits for g.ay partners of state employees that are in new contracts. Representative Ken Bradstreet of G.aylord says he's also asking fellow Republican Attorney General Mike Cox to issue a legal opinion on the issue." (AP via WILX 10)
Hewitt Federal Legislation Quick Guide Updated November 23, 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)
Newly Posted Events
Understanding the proposed new §403(b) regulations
Nationwide on December 2, 2004
presented by National Tax Sheltered Accounts Association
Newly Posted Press Releases
Newkirk Announces the Creation of Participant Investor Services
(Newkirk Products, Inc.)
New Internet-based Market Intelligence Search Tool Released by Industry-Leading Information Provider
(benefits information group)
Principal Financial Group Hails Introduction of DBk Legislation
(The Principal Financial Group)
U.S. Labor Department Extends Annual Reports Deadline After Severe Storms and Flooding Hit New York
(U.S. Department of Labor, Office of Public Affairs, New York, N.Y.)
Newly Posted or Renewed Job Openings
Pension Consultants/Administrators
for Northern NJ Mid-Size Pension Consulting Firm
in NJ
401k Account Executive
for BISYS Retirement Services
in PA
Supervisor, Client Services
for BISYS Retirement Services
in PA
Broker Dealer Counsel - Compliance Analyst
for ADP Retirement Services
in NJ
Enrollment Specialist
for National Automobile Dealers Association
in VA
Senior Consultant - Retirement Plan Services
for Tofias PC
in MA
Benefits Manager
for MasterBrand Cabinets, Inc.
in IN
Defined Benefit Client Account Manager
for The Senex Group, Woodland Hills, California
in CA
Pension Administrator
for C.H. Dean & Associates, Inc. Pension Consulting Division
in OH
Senior Pension Administrator/Supervisor
for Snyder Cohn
in MD
Defined Contribution Plan Administrator
for Benefit Associates Inc.
in CA
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
Copyright 2004 BenefitsLink.com, Inc.; except that you can reprint this newsletter in full (if you also include this boilerplate part) without obtaining our permission.
Published by:
BenefitsLink.com, Inc.
https://benefitslink.com/about.html
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
Editor and Publisher: David Rhett Baker, J.D.
Housekeeping: