BenefitsLink Welfare Plans Newsletter June 8, 2005 Today's sponsor: Employee Benefits Institute of America (EBIA) (Click on company name or banner to learn more.) Explore the Seven Wonders of the Benefits Compliance World No HR or benefits professional's library would be complete without EBIA's compliance manuals. Save time and steer clear of compliance traps by joining thousands of professionals who rely on our manuals. "I know I can rely on your manuals, above and beyond any others, to be clear, concise, easy to understand, and accurate!" -Director of Flexible Benefits (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) Overview: Section 125 Plan 2-1/2 Month Grace Period: Participants' Bonus and Administrators' Bane Excerpt: "While falling far short of a repeal of the use it or lose it rule, the Notice does provide some welcome relief for participants. That relief, however, comes at a potentially high price for employers and third party administrators. Due to the apparent complexity of administration, and the number of unanswered questions surrounding the grace period, you should carefully consider the impact of adding a grace period to your Section 125 Plan." (Trucker Huss, APC) Overview: New FSA Extension Creates Issue for HSA Participants (PDF) 1 page. Additional 2-1/2 months' use of Flexible Spending Accounts may create issue for Health Savings Account contributions by participants. (Hewitt Associates) Overview: IRS Okays Extra 2-1/2 Month Grace Period to Incur FSA Expenses Excerpt: " At the close of the grace period and applicable run-out period, any amounts that remain in the FSA must be forfeited. A employer may not apply unused amounts under one FSA toward expenses incurred under another FSA (for example, unused amounts in a health FSA may not be used to reimburse dependent care expenses)." (Hewitt Associates) New Coverage Choices and Cost-Management Options: Public Sector Pres.cription Drug Plans Update (PDF) 4 pages. Excerpt: "This issue discusses several topics related to pres.cription drug coverage: Managing the high cost of specialty or biotech drugs; Evaluating 'transparency' offerings by pharmacy benefit managers; Considering coverage for over-the-counter drugs, and Obtaining discounts from drug manufacturers." (The Segal Company) Overview: HIPAA Enforcement News -- A Look at Civil and Criminal Penalties 4 pages. Excerpt: "The Department of Health and Human Services' Proposed 'Final Rule,' published on April 18, established standards for imposing civil money penalties for violating regulations issued under HIPAA and procedures for obtaining a review of a proposed penalty. On June 1, 2005, a Department of Justice Office of Legal Counsel ruling determined that criminal penalties may be applied only against HIPAA covered entities and not their employees." (Dechert LLP) Quality Standards Developed for Consumer-Driven Health Program Users Excerpt: "URAC, which evaluates health programs, has set accreditation standards for employers, workers and benefit consultants determining the quality of consumer-driven health programs. The standards address consumer-driven products for workers making their own decisions about medical care. They focus on administrative transactions, decision support tools and education support for employees." (BenefitNews Connect) Patient HMO Insurance / Physician HMO Participation Related to Racial Disparities in Primary Care Excerpt: "Objective [of the study was to] examine the relationship between racial disparities in common primary care procedures and patient HMO membership and physician level of HMO participation. .... Data were obtained from a nationally representative sample of primary care office visits documented in the National Ambulatory Medical Care Survey for 1985, 1989-1992, and 1997-2000. Patient HMO membership was assessed based on reports by primary care physicians ...." (The American Journal of Managed Care) Experiment Launches to Share Health Data Across the Country Electronically Excerpt: "The effort is intended as the first step toward creating a national health information exchange network built on common, open standards." (CIO Insight) Opinion: Free-Market Philosophy Doesn't Always Work for Health Care Excerpt: "As the head of Medicare and Medicaid, Mark McClellan ... was to rule [today] on one of the most heavily lobbied issues of the past year: whether to lift an 18-month moratorium on creating new physician-owned specialty hospitals. It's all very technical and bureaucratic, to be sure. But in deciding the issue, McClellan is being asked to choose between two competing and fundamentally irreconcilable models for the U.S. health care system." (The Washington Post; one-time registration required) Health Care for Uninsured Raises Premiums, According to Families USA Study Excerpt: "Providing health care for the uninsured increases the annual cost of insurance premiums for the average worker by $341 and for the average family by $922, according to a study by a group promoting universal health insurance. Families USA says its study shows the problem is not restricted to the tens of millions of uninsured Americans. Rather, the problem affects everyone, because the insured subsidize the cost of care given the uninsured." (AP via The Washington Post; one-time registration required) Overview of the Reimportation of Pres.cription Medicine Controversy (PDF) 1 page. The Segal Company presents a very brief recent history of the controversy. (The Segal Company) Opinion: How to Achieve a Healthier Health Care System Excerpt: "To get a healthier health system, we need comprehensive changes that deal with such issues as: Enterprise-wide management approaches that can allow us to get cost under control. These include 'evidence-based medicine' that uses procedures and treatments that have the best record at being effective and efficient, and performance measurement of the system's most important processes." (The Kansas City Star; one-time registration required) The Muskegon Access Health 'Three-Share' Plan: A Case History (PDF) 32 pages. Excerpt: "The nonpartisan Employee Benefit Research Institute ... published a detailed examination of a unique community-based initiative to expand health care coverage to uninsured workers at small firms in Muskegon, MI. Known as Access Health, the initiative began in 1999 with ambitious goals: enrolling 500 businesses and 3,000 residents in a 'three-share' partnership involving employers, employees, and the community of Muskegon, ...." (Employee Benefit Research Institute) Links to Items on Executive Comp, Benefits in General Leading Practices in Executive Compensation (PDF) 9 pages. Excerpt: "This study ... prepared for the 2005 Center for Corporate Change forum [addresses] trends and strategies in executive and board member compensation at public companies. It is informed by a detailed 2005 survey of Fortune 500 company proxies that was conducted by the Heidrick & Struggles Knowledge Management Centre (KMC) in India." (Heidrick & Struggles) Hewitt Federal Legislation Quick Guide Updated as of June 7, 2005 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) Fill Out The 2005 Spencer Survey Of Benefits Managers Excerpt: "Spencer Benefits Reports, Aspen Publishers, and CCH, Inc., are currently collecting data for their 2005 Spencer Survey of Benefits Managers and employee benefits departments. This tenth biennial survey requests information concerning compensation, organization, and functional responsibilities of corporate employee benefits departments. All survey respondents who provide an e-mail address will receive a copy of the published survey at no charge." (Spencer Benefits Reports) Newly Posted Events Form 5500 Workshop & Plan Audits in New Jersey on June 14, 2005 presented by Worldwide Employee Benefits Network (WEB) - NJ IRA Required Minimum Distributions Web/Telephone Seminar Nationwide on August 16, 2005 presented by BISYS Retirement Services New FSA Use-It Or Lose-It Forfeiture Rule Nationwide on June 14, 2005 presented by International Foundation of Employee Benefit Plans Roth IRA Distributions Web/Telephone Seminar Nationwide on August 4, 2005 presented by BISYS Retirement Services SEP Plans Web/Telephone Seminar Nationwide on August 25, 2005 presented by BISYS Retirement Services Uncovering Fraud in Your Health Plan Nationwide on June 16, 2005 presented by International Foundation of Employee Benefit Plans Newly Posted Press Releases Companies Report A Record $353.7 Billion Pension Shortfall In Latest Filings With PBGC -- Agency Also Announces New Analysis Of United Airlines Pension Plans (Pension Benefit Guaranty Corporation (PBGC)) Newly Posted or Renewed Job Openings Senior Pension Administrator for American Fiduciary Corporation in MA Benefits Manager for Capital Group Companies, Inc. in TX Retirement Plan Sales Executive for Ceridian in CA, IL, OR, WA, WI Benefits Director for Ross Stores, Inc. in CA Handy Links: View Today's Active Message Threads Search BenefitsLink Using the Web for Employee Benefits Research (hypertext article) Employee Benefits Library Copyright 2005 BenefitsLink.com, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission. 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