BenefitsLink Welfare Plans Newsletter June 13, 2005 Today's sponsor: ALM (Click on company name or banner to learn more.) Complete Benefits Law Guidance from Law Journal Press The nation's workforce and health care system are constantly evolving and so are the legal issues. Law Journal Press helps you handle any benefits law question with up-to-date, authoritative books on all aspects of the field. Get legal and practical advice from leading experts on everything from COBRA to ERISA, "contingent" employees to family and medical leave, and more. Browse our product listings for detailed information and special offers. (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) Sec. 125 Grace Period May Create Roadblock For HSA Participation Excerpt: "Employers that adopt the new two-and-one-half-month grace period for flexible spending accounts may be creating 'other coverage' that will 'render a participant in a high-deductible health plan (HDHP) ineligible to contribute to a health savings account (HSA),' according to Hewitt Associates." (Spencer Benefits Reports) FACTA Interim Final Rules Issued on Medical Information Privacy Excerpt: "The federal bank, thrift, and credit union regulatory agencies of the Department of the Treasury have published interim final rules regarding medical privacy under the Fair and Accurate Credit Transactions Act of 2003 (FACTA). The Fair Credit Reporting Medical Information Regulations create exceptions to the statutory prohibition against obtaining or using medical information in connection with credit eligibility determinations." (Federal Register via HIPAAdvisory.com) Overview: Who Can Be Prosecuted under HIPAA's Administrative Simplification Provisions Excerpt: "In this memorandum, the Office of Legal Counsel at the U.S. Department of Justice (DOJ) provides its legal opinion regarding who can be prosecuted under the statute and what is required for an act to be committed 'knowingly.'" (Employee Benefits Institute of America Inc.) Abstract: A Shared Responsibility -- U.S. Employers and Health Insurance Provision to Employees (PDF) Excerpt: "In [the article, the authors] explore the characteristics of workers who do not receive coverage from their own firms; examine how health care costs are spread across workers, employers, and the government; and recommend policy options to expand and strengthen employer-sponsored coverage." (Inquiry via The Commonwealth Fund) Employer Required to Reimburse Medicare Payments Even Though It Couldn't Recover from Insurer Excerpt: "This case highlights a financial risk for employers--liability to repay the government for mistaken Medicare payments even if the deadline for the employer to seek reimbursement from an insurer has passed. The court noted that employers can address this concern by obtaining agreements with insurers that allow recourse for the same period that the government has to seek reimbursement from the employer." (Employee Benefits Institute of America Inc.) Considerations in Creating a Medicare Part D Formulary: A Guide for Pres.cription Drug Plans (PDF) 30 pages. Excerpt: "Access to medications is the key concern of every stakeholder in the Medicare Part D outpatient drug benefit. Beneficiaries want increased access that will reduce out-of-pocket expenses. Pres.cription drug plans want to control access so as to assure the financial viability of their programs. Medicare Advantage plans want to promote access as a means to reduce hospitalizations and other expenditures." (Managed Care) Insurer United Healthcare Pushes Pill-Splitting Savings Excerpt: "The nation's second-largest health insurer, UnitedHealthcare, is giving away pill-splitters and offering half-price on drugs for those who split double-strength pills, cutting the patient's insurance copayment in half. The company is also providing advice on which drugs can be safely cut in half." (AP via The Washington Post; one-time registration required) Costco to Test Sales of Health Insurance to Members in California Excerpt: "Costco Wholesale Corp., the low-cost bulk supplier, is adding health insurance to its warehouse shelves. In a pilot program to be started next month in Southern California, Costco will offer family and individual coverage to its customers who pay $100 a year for 'executive' membership, company officials said. The insurance is aimed at people such as contractors, waiters and students who are self-employed or cannot sign up for plans at work." (Chicago Tribune; one-time registration required) Tax Credits for Health Insurance -- An Examination (PDF) 44 pages. Excerpt: "Expanding health coverage through the tax system may not be the most efficient path, but tax subsidies appear the only game in town for expanding the federal role in the provision of health insurance. This paper examines the implications of major expansions in tax credits for health insurance, starting with the President's refundable tax credit proposal. Based on a microsimulation model, we examine the effects of the proposal on health insurance coverage generally, ...." (Urban Institute) The Impact of Immigration on Health Coverage in the United States (PDF) Pages 2-8 of 16. Excerpt: "[The report] finds that while the uninsured population of the United States is still dominated by native-born Americans, it is becoming increasingly comprised of immigrants, and the trend appears to be accelerating." (Employee Benefit Research Institute) Health Benefits Plan Approved for Those without Other Health Insurance Options in Pennsylvania Excerpt: "The Pennsylvania Department of Insurance approved HealthAmerica and HealthAssurance's new health insurance plan for individuals, families and sole proprietors who are not eligible for employer-sponsored health-care benefits, Medicaid or Medicare." (Philadelphia Business Journal via bizjournals.com; one-time registration required) Opinion: One Nation, Uninsured or Government Insurance, Not Government-Provided Health Care Excerpt: "Harry Truman tried to create a national health insurance system. Public opinion was initially on his side: Jill Quadagno's book 'One Nation, Uninsured' tells us that in 1945, 75 percent of Americans favored national health insurance. If Truman had succeeded, universal coverage for everyone, not just the elderly, would today be an accepted part of the social contract." (The New York Times; one-time registration required) Book Review: One Nation, Uninsured -- Why the U.S. Has No National Health Insurance Excerpt: "Tens of millions of Americans cannot afford basic care. It's a serious problem -- but not, Jill Quadagno reminds us in One Nation, Uninsured , a particularly novel one. On the contrary, similar health care 'crises' cropped up repeatedly during the 20th century, always playing out in the same unfulfilling way. First, anxiety over affordable health care leads progressive politicians to push for universal health insurance. Then the campaign fails." (The Washington Post; one-time registration required) Opinion: The Geezer Threat to America's Future, or Not Excerpt: "[The] inheritance from the last century--the great gift of longer life--surely represents one of the country's most meaningful accomplishments. Yet the achievement has been transformed into a monumental problem by contemporary politics and narrow-minded accounting. 'The nation faces a severe economic threat from the aging of its population combined with escalating health costs,' .... Others put it more harshly. 'Greedy geezers' are robbing from the young, bankrupting the government." (William Greider via The Nation) Links to Items on Executive Comp, Benefits in General Christopher Cox Should Start Off at the SEC by Doing Right on Stock Options Excerpt: "[T]he first issue [Cox is] going to face - and one that has the potential to set the tone for [his] chairmanship - is the expensing of stock options." (The New York Times; one-time registration required) Employers Not Yet Giving Up on Stock Compensation, but Are Making Changes Excerpt: "Increased regulatory attention to stock options including new expensing rules have not yet led employers to give up on equity compensation, according to a new survey. According to the 2005 Global Equity Incentives Survey by PricewaterhouseCoopers (PwC), companies are still using options as their primary reward vehicle, but many are adding performance-based standards, are restricting employee eligibility for those plans, and are cutting the overall number of options awards." (PLANSPONSOR.com; one-time registration required) Overview: June 30 Deadline for Deferrals under Calendar Year Performance Plans (PDF) 2 pages. Excerpt: "New Internal Revenue Code Section 409A ... generally requires that elections to defer compensation under a nonqualified deferred compensation plan be made in the year prior to the taxable year in which the underlying services are performed. However, there is an exception to this general rule for elections related to certain performance-based compensation." (Womble Carlyle) Benefits Update: Bonus Deferral June 30 Deadline for Calendar-Year Deferred Compensation Plans Excerpt: "New Code Section 409A imposes strict deadlines for making elections to defer compensation. In general, elections to defer compensation must be made before the beginning of the calendar year in which the services for which the compensation is payable are performed. Thus, under the general rule, an election to defer a bonus for services performed in 2005 would have to have been made by December 31, 2004." (Ice Miller) Newly Posted Press Releases ICC Plan Solutions Offers Participant "Wake-Up Call" (ICC Plan Solutions) American Pension Services, Inc. Celebrates 5 Year Anniversary (American Pension Services, Inc.) Newly Posted or Renewed Job Openings Client Relations Manager for RSM McGladrey Retirement Resources in IL Retirement Professionals for Mercer Human Resource Services in MA Retirement Plan Coordinator for American Funds in IN Director, Employee Benefits for Raley's in CA Conversion Manager for ADP in KY, OH Retirement Plan Conversion Tech I for Southeastern Employee Benefit Services a division of First Charter in NC Legal - Retirement Plan Specialist for Great-West Corporate in CO Defined Contribution Administrator for Howard Simon & Associates, Inc. in IL Vice President, Retirement Services for Invesmart, Inc. in PA Regional Vice President - Northern California for BISYS Retirement Services in CA Regional Vice President - Raleigh/Durham, North Carolina for BISYS Retirement Services in NC Regional Vice President - Chicago, Illinois for BISYS Retirement Services in IL 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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