BenefitsLink Welfare Plans Newsletter August 17, 2005 Today's sponsor: World Congress (Click on company name or banner to learn more.) The World Congress 1st Annual Human Capital Management Congress The World Congress is proud to present the 1st Annual Human Capital Management Congress taking place this October 31 - November 2, 2005 at the Omni Shoreham Hotel in Washington, DC. The HCMC will bring together the most innovative and knowledgeable industry experts addressing the most pertinent issues relating to health and human capital management. The event is uniquely designed to discuss the impact of benefits on employee productivity, healthcare costs and overall company competitiveness. (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) Exposure Draft: Health Practice Note 2005-X --Attestation of Actuarial Equivalence for Plan Sponsors (PDF) 19 pages. Excerpt: "The purpose of this practice note is to provide advisory guidance to the actuary attesting to the actuarial equivalence of a plan sponsor's retiree health plans under the requirements of42 CFR 423.884 for payments to sponsors of retiree pres.cription drug plans. The actuarial comparison of plan values required by the regulation will involve methods common to health actuaries but in an entirely new circumstance." (American Academy of Actuaries) Nuts, Bolts and Screws-- A Guide to Open Enrollment Forms and Materials Excerpt: "Open enrollment comes only once a year. Although participants rarely appreciate the amount of time and effort that goes into open enrollment materials, those materials provide an excellent opportunity to reach out to participants and beneficiaries. Open enrollment is not just a tool, but a power tool. This report is about using that tool and getting the most out of the opportunity." (BNA's ERISA Compliance & Enforcement Library via Thelen Reid & Priest LLP) Overview: FMLA Releases Unenforceable without DOL or Court Approval -- May Void Entire Agreement (PDF) 3 pages. Excerpt: "The U.S. Court of Appeals for the Fourth Circuit recently held that an employee who signed a general release in exchange for monetary compensation did not waive the right to bring an action under the FMLA, because the release had not been approved by the Department of Labor or a court." (Powell Goldstein LLP) As Gasoline Prices Rise, Firms Get Creative -- Offer Telecommuting, Van Pools, More to Help Workers Excerpt: "As gasoline breaks the $2.50 a gallon barrier, creative energy-saving ideas are beginning to flow from US business that could help Americans spend less at the pump. More companies are helping employees cut out-of-pocket fuel expenses through telecommuting programs." (The Christian Science Monitor) Minnesota Regional Service Co-Ops Unfair in Health Insurance Purchasing Practices, Alleges Bidder Excerpt: "The purchasing pools that buy health insurance for hundreds of Minnesota school districts and local governments still are favoring Blue Cross and Blue Shield of Minnesota, according to rival insurance provider HealthPartners. In June, Minnesota state Auditor Pat Anderson said that eight regional service cooperatives, ..., were spending too much on health insurance because of their 'cozy and tangled relationship' with Blue Cross." (Star Tribune; one-time registration required) Stronger Rules Sought on Association Health Plans Excerpt: "A consumer group petitioned state Insurance Commissioner John Garamendi on Tuesday to strengthen rules governing health insurance policies sold through associations because the plans have sometimes provided marginal benefits. .... Though some associations offer legitimate policies, others have hidden clauses that cap benefits at low amounts so that policyholders can face unforeseen rate increases with little financial protection in a major illness, critics said." (Los Angeles Times; one-time registration required) 2005 Legal Checklist for Welfare and Health Plan Administrators Excerpt: "The [target page] is a short list of legal changes taking effect this year." (Thelen Reid & Priest LLP) UnumProvident Opens Three Onsite Employee Health Centers Excerpt: "Realizing the need to better coordinate medical benefits, disability insurer UnumProvident has opened onsite health care centers for workers at three locations. .... They will offer blood tests, blood-pressure monitoring and allergy injections. Staffed with nurse educators, the centers will conduct educational sessions on diabetes, weight reduction and cardiovascular health." (BenefitNews Connect) Consumers Elevate HMOs over PPOs, According to Consumer Reports Survey Excerpt: "HMOs are slightly more palatable than PPOs to consumers, who are becoming more price-resistant and willing to sacrifice choice of providers for lower costs. That's the crux of the latest findings from the magazine Consumer Reports, which interviewed 35,000 readers about their health plans." (BenefitNews Connect) Second Annual Health Providers Group Purchasing Survey -- 2005 The survey offers the following information: Group Purchasing Survey respondents; Group purchasing volume - Ranked by 2004 purchasing volume ($ in millions); GPO membership - Companies ranked by number of hospitals purchasing supplies; GPO financials - Based on companies that provided 2004 revenue figures; GPO purchasing volume per hospital member - Ranked by 2004 revenue per hospital; and more. (modernhealthcare.com) Employer Choices of Family Premium Sharing (PDF) 40 pages. Excerpt: "[The authors] map out employer choices of cost-sharing of health insurance premiums for family coverage. .... [They] describe how employee contributions for family coverage have varied over time, across categories of establishments, and across health insurance plan types. They attempt to attribute the changes to work force characteristics ..., healthcare costs, local labor market conditions ..., and firm size. .... The findings offer insight into the future of family ...." (U.S. Employee Benefits Security Administration) Prices of Drugs for Elderly Said to Far Outrun Inflation Excerpt: "For the third consecutive year, the average prices of dozens of brand-name pres.cription drugs widely used by elderly Americans have risen more than twice as fast as general inflation, according to a survey to be released today by the advocacy group AARP." (The New York Times; one-time registration required) Health Insurance and Labor Market Outcomes: Joint Decision-Making Within Households (PDF) 45 pages. Excerpt: "Anne Royalty and Jean Abraham analyze the effects of health insurance on a host of labor market choices by couples. [Paper was originally published May 2004.]" (U.S. Employee Benefits Security Administration) The State of Health Insurance in California: Findings from 2003 California Health Interview Survey (PDF) 84 pages. Excerpt: "This report ... shows that job-based health insurance coverage -- the backbone of the state's system of health insurance -- is declining. More than 6.6 million Californians under age 65 (more than one in five nonelderly residents) went without insurance for at least part of 2003 and more than 3.7 million lacked health coverage for the entire year." (UCLA Center for Health Policy Research) Number of Uninsured Californians Remains Steady Despite Drop in Employer-Sponsored Coverage Excerpt: "The number of uninsured California residents has remained steady at about 6.6 million in recent years in part because of increased enrollment in public programs such as Medi-Cal and Healthy Families, while rates of employer-sponsored health insurance have declined, according to a study released Tuesday by the University of California-Los Angeles Center for Health Policy Research, the San Diego Union-Tribune reports ...." (California Healthline) Links to Items on Executive Comp, Benefits in General Many Plan to Keep Working Into Retirement Excerpt: "Nearly 7 in 10 workers plan to stay on the job past retirement age -- including a growing number who say the decision will be driven by financial need, a new survey finds. .... But the nationwide poll, by the John J. Heldrich Center for Workforce Development at Rutgers University, taps into increasing concerns among many workers -- particularly Baby Boomers -- about the need to supplement their income once they leave their primary job." (AP via The New York Times; one-time registration required) Overview: Tech Companies Scale Back Use of Stock Options Excerpt: "The Towers Perrin Equity Compensation Strategy Pulse Survey, which incorporates responses from 30 major U.S. technology companies with average annual sales of $4.4 billion, also provides evidence that technology sector companies are starting to reevaluate and change the mix of their equity incentive programs for all levels of employees, although they continue to favor stock option grants for top executives." (Towers Perrin) Overview: Pennsylvania Law Provides Clarity on State Taxation of Nonqualified Deferred Compensation (PDF) 3 pages. Excerpt: "Pennsylvania has enacted a law that clarifies the taxation of elective deferrals to nonqualified deferred compensation plans for state tax law purposes, generally retroactive to 2003. That is, amounts deferred under nonqualified plans will not be taxed at the time of deferral, but will be taxed along with earnings at the earlier of actual or constructive distribution." (Buck Consultants LLC) Watson Wyatt Human Capital Index® -- Human Capital As a Lead Indicator of Shareholder Value Excerpt: "Do better people management strategies actually create higher market value? Or do financially successful companies simply have more resources to allocate to human capital initiatives? .... .... The results are in and they are dramatic. Superior human capital practices are not only correlated with financial returns they are, in fact, a leading indicator of increased shareholder value." (Watson Wyatt Worldwide) Overview: IRS Says No to Medical Reimbursement Accounts in Profit Sharing Plans (PDF) 2 pages. Excerpt: "The IRS recently issued a revenue ruling in which it states that medical reimbursement accounts in a nongovernmental profit sharing plan will result in the plan's disqualification because the minimum vesting requirements of Section 411 are not satisfied. This ruling puts the kibosh on many arrangements that have been suggested or implemented to help employers provide retiree medical benefits for their employees." (Buck Consultants LLC) Research Brief: Simulating the Effect of Changes to the OASDI and Medicare Programs 2 pages. Excerpt: "In this paper, [the authors] report estimates of a dynamic programming model that addresses the interplay among health, financial resources, and the labor market behavior of men nearing retirement age." (University of Michigan Retirement Research Center) Newly Posted Events The New Determination Letter Program in Illinois on September 8, 2005 presented by ASPPA Benefits Council of Chicago Newly Posted Press Releases Two Step Announces Hosting Service for Corporate Focus Entity, Ownership and Minute Book Software (Two-Step Software, Inc.) BenefitStreet Rolls Out New Branded Enrollment Solution (Metrics Partners) Scudder Expands Fiduciary Toolkit for Retirement Advisors (Scudder Investments) Newly Posted or Renewed Job Openings 401(k) Enroller (Bi-Lingual) for 401(k) Advisors in CA 401(k) Employee Communications Specialist (Bi-Lingual) for 401(k) Advisors in CA Retirement Plan Specialist for American Funds, a part of the Capital Group Companies, Inc. in TX Benefits Administrator/Night Trading for Buck Consultants, an ACS company in GA Tax Attorney for Frost Brown Todd in OH Attorney---Employee Benefits for Willis in MO, PA 401(k) Education Meeting Coordinator for CitiStreet in MA Benefits Manager for Capital Group Companies, Inc. in CA Pension Administrator for Tax Sheltered Compensation, Inc. in MN Client Services Analyst - QDRO for Mercer HR Services in TX Employee Benefits Client Manager for Employee Benefits Brokerage and Consulting Firm in KS 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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