BenefitsLink Welfare Plans Newsletter December 8, 2005 Today's sponsor: The International Foundation's Introduction to HSAs and HRAs Online Course (Click on company name or banner to learn more.) Need a primer on HSAs and HRAs? The International Foundation has introduced a new Health Savings Account (HSA) and Health Reimbursement Arrangement (HRA) online course, available 24/7. Designed to provide a thorough overview of HSAs and HRAs as well as the pros and cons, it covers: HSA eligibility, requirements, contributions and distributions ERISA application Integrating HSAs and HRAs with employer health plans Visit http://www.ifebp.org/hsahra today! (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) Employers Spending Less on Holiday Practices in 2005 Excerpt: "Paid holiday leave will be more generous in 2005, company-wide parties will be more prevalent, and charitable giving and community activities will remain a staple for most organizations, while paid holiday leave over the longer term is on the decline, employers have reduced party spending, and year-end gifts and bonuses have dipped slightly, according to a survey from BNA." (PLANSPONSOR.com; one-time registration required) 'Financial Concerns' Prompt OPM to Consider Dropping Postmasters Benefit Plan Excerpt: "The Office of Personnel Management yesterday announced that it has proposed dropping the Postmasters Benefit Plan from the federal employee health insurance program next year because of 'performance and financial concerns.'" (The Washington Post; one-time registration required) Reviving Managed Care with Health Savings Accounts Excerpt: "Although health savings accounts (HSAs) and managed care are often seen as antithetical, they can be integrated in fruitful ways. Moreover, combining these approaches would serve policy objectives by clarifying the payment responsibilities of patients, health plans, and premium payers, thus altering important perceptions about health care decision making." (Health Affairs; full text of article available free until January 2006) The Secret Price of Drugs Excerpt: "The middlemen companies that manage pres.cription drug benefits for big companies, states and pension plans in the United States have fought hard to keep what they really pay manufacturers for drugs a secret. And they've successfully fended off state efforts to regulate them and force more transparency--until now." (Forbes.com) Opinion: Lessons from Medicare Part D Excerpt: "For benefit professionals, this headline and lead paragraph from The Washington Post last month was certainly not news: Seniors Find Medicare Drug Plan Options Bewildering Seniors interviewed by reporters say they are still confused and it is driving some of them 'crazy.' Even those seniors who are well educated, computer literate, and 'savvy' are having a hard time navigating the array of plans, deductibles, premiums, and exceptions. .... Do ya think?" (Richard D. Quinn, Views & Vents via BenefitNews.com) Employers Approaching Limits of Cost Sharing -- Seeking New Rx Drug Strategies Excerpt: "Employers have just about maximized the potential cost savings that can be achieved by shifting costs to members, and are starting to try more aggressive tactics to control pres.cription drug costs, according to a new survey by Mercer Health & Benefits, a human resources consulting firm serving mainly self-funded employers." (DRUG BENEFIT NEWS via AISHealth.com) Many Employers Plan to Tackle Specialty Pharmacy Coverage and Costs in 2006 Excerpt: "More than a third of employer health plan sponsors responding to a new survey said they intend to review their specialty pharmacy coverage and policies for 2006, and that could result in new business opportunities for specialty pharmacy providers (SPPs). In a survey just released by Mercer Health & Benefits, ..., more than half of the employers said they had not yet addressed specialty pharmacy costs, and a full 36% said that 2006 would be the year they do so." (SPECIALTY PHARMACY NEWS via AISHealth.com) Companies Retain Retiree Drug Benefits for Now, According to Study Excerpt: "The launch next year of Medicare's new pres.cription drug program is not prompting companies that offer retiree drug benefits to drop those benefits -- at least in the short run. But many employers are unsure what they will do a few years from now when it comes to pres.cription drug benefits, according to a new study of the programs and plans of large U.S. corporations." (The Washington Post; one-time registration required) Findings: Early Experience with High-Deductible and Consumer-Driven Health Plans Excerpt: "'This Issue Brief presents results of the first EBRI/Commonwealth Fund Consumerism in Health Care Survey, which was conducted to provide reliable national data on the growth of high deductible plans and their impact on the behavior and attitudes of health care consumers. [The 32 page report in PDF format is at http://www.ebri.org/pdf/briefspdf/EBRI_IB_12-2005.pdf.]" (Employee Benefit Research Institute) Employers Face Challenges with Retirement Health Benefits Excerpt: "In recent years, the percentage of businesses with at least 200 employees that offer retiree health coverage has steadily eroded." (CIO Today) HSA Marketplace Excerpt: "Since the Jan. 1, 2004, effective date for health savings accounts (HSAs), health insurers have continued to flood the HSA marketplace with different products and partnerships. Click here for a spotlight of the latest news." (Spencer's Benefits Reports) Text of Corrections to Proposed Regs on Comparable Contributions to Health Savings Accounts (HSAs) (PDF) Excerpt: "This document contains corrections to a notice of proposed rulemaking that was published in the Federal Register on Friday, August 26, 2005 (70 FR 50233) providing guidance on employer comparable contributions to Health Savings Accounts (HSAs) under section 4980G." (Internal Revenue Service) Overview: IRS Addresses Another FSA Grace Period Issue -- Health Savings Accounts (PDF) 3 pages. Excerpt: "Earlier this year, the IRS issued guidance allowing employers to amend their health flexible spending arrangements (health FSAs) to permit participants to be reimbursed for expenses incurred during a grace period following the end of the plan year. It was unclear how the existence of the grace period might affect an individual's ability to contribute to a health savings account. This issue has now been addressed by the IRS." (Buck Consultants) Links to Items on Executive Comp, Benefits in General Labor Force Projections to 2014: Retiring Boomers (PDF) 20 pages. Excerpt: "The labor force will continue to age, with the annual growth rate of the 55-and-older group projected to be 4.1 percent, 4 times the rate of growth of the overall labor force." (Monthly Labor Review, U.S. Bureau of Labor Statistics) Analysis: 409A Proposed Regs Are Tour de Force-- But Grandpa Is Still In Hiding Excerpt: "The proposed regulation on the nonqualified deferred compensation rules of Code section 409A ... is not a page turner (though it's a lot of pages to turn, at 238 pages); but that didn't stop this reader from furiously (if wearily) turning its pages to search for the grandfather rules that I had found so elusive in December when the initial official guidance under the statute ... was released by the Service ... Alas, my search of the just-proposed regs has proved unenlightening." (Alvin D. Lurie) Overview: New IRS Nonqualified Deferred Compensation Plan Guidance (PDF) 2 pages. (Milliman) Overview: IRS Proposed Regulations on Deferred Compensation Plans (PDF) Pages 1-4 of 16 pages. Excerpt: "The Regulations should claim the attention of all participants in any nonqualified deferred compensation plan ('NQDC') such as a Salary Continuation Plan or Supplemental ExecutiveRetirement Plan." (Jenkens & Gilchrist) TIAA-CREF Pressures Companies to Disclose More on Executive Pay Excerpt: "The average U.S. chief executive officer makes $10 million a year, compared with about $22,000 for an entry-level employee, according to the Council of Institutional Investors, whose members include TIAA-CREF. The group has made compensation its top governance issue as a growing number of companies, including Morgan Stanley and Fannie Mae, were faulted by shareholders for excessive pay." (Bloomberg News) Hewitt Federal Legislation Quick Guide Updated as of December 6, 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) Newly Posted Events 2006 Annual Meeting - Note: Dates Have Changed in Missouri on September 23, 2006 presented by NAGDCA (National Association of Government Defined Contribution Administrators, Inc.) Nonqualified Plan Accounting Nationwide on December 21, 2005 presented by Retirement Capital Group The Benefits Conference of the South in Georgia on March 20, 2006 presented by ASPPA & IRS Newly Posted Press Releases Consumer-Directed Health Plan Participants Less Satisfied Than Those With Comprehensive Insurance, Survey Finds (Employee Benefit Research Institute (EBRI)) Labor Department Publishes 2005 Form M-1 for Multiple Employer Welfare Arrangements - Online Filing Available (U.S. Department of Labor, Employee Benefits Security Administration) RiverSource Investments, LLC Hires Regional Vice President, Institutional Sales (Ameriprise Retirement Services) Ameriprise Retirement Services Sends Delegate to the 2005 White House Conference on Aging (Ameriprise Retirement Services) ERISA Expertise Releases New Roth 401(k) Analyzer, Employer Guides and Participant Knowledgebase (ERISA Expertise LLC) Newly Posted or Renewed Job Openings Relationship Manager for The Bank of New York in NY OmniPlus Business Analyst for High Point Consulting & Staffing, LLC in ANY STATE 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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