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January 5, 2006
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(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

AARP Files Brief December 29, 2005, to the Third Circuit in AARP v. EEOC
Excerpt: "[A]ARP filed their brief in the latest round of appeals for the AARP v. EEOC litigation, .... The Department of Justice, on behalf of the EEOC, is scheduled to submit their brief by January 18th, and amicus briefs are due by the 25th. [The brief is linked to the target page.] (The ERISA Industry Committee)

Overview: Technical Corrections in Gulf Opportunity Zone Act of 2005 Expand Definition of Dependent (PDF)
3 pages. Excerpt: "A number of technical corrections to recent tax legislation are included among the act's provisions affording hurricane-related tax relief and incentives. Specifically, section 404 of the act contains technical corrections to the Working Families Tax Relief Act of 2004, which itself made a number of clarifying and corrective changes to the definition of the term 'dependent' under the Internal Revenue Code." (Morgan, Lewis & Bockius LLP)

Overview: Publication 503 for Child and Dependent Care Expenses -- Updated for 2005
Excerpt: "Most of these changes follow from prior legislation and guidance and are not particularly surprising. [EBIA is] intrigued, however, by the changes to the discussion of payments to relatives or dependents, and wonder[s] if the addition of these specific items is intended to discourage perceived abuses." (Employee Benefits Institute of America Inc.)

Federal Employee Mileage Reimbursement Rate to Drop 4 Cents
Excerpt: "The General Services Administration will announce a new mileage reimbursement rate Friday, lowering it 4 cents to 44.5 cents per mile for 2006. The rate, which applies to employees who use personal vehicles for government business, is retroactive for all official travel performed on or after Jan. 1, 2006, ...." (

Overview: 2006 Version of Publication 15-B -- Employer's Tax Guide to Fringe Benefits
Excerpt: "Publication 15-B, a supplement to IRS Publication 15 (more commonly known as Circular E), provides specialized and detailed information on the employment tax treatment of fringe benefits. Although little has changed from last year, the publication has been updated for increased limits and is a practical resource for employers and administrators involved with fringe benefit programs." (Employee Benefits Institute of America Inc.)

San Francisco Chamber Girds for Health Care Fight on Proposal to Require Benefits
Excerpt: "The San Francisco Chamber of Commerce is solidifying opposition to pending legislation that would require companies and nonprofit groups with 20 or more employees to provide health benefits for their workers." (San Francisco Chronicle via BlueCross BlueShield Association)

Eighth Circuit Overturns Record Award of COBRA Damages and Penalties
Excerpt: "The court did not explain why the termination of coverage was a qualifying event. The employee's original reduction in hours might have been the triggering event, except that the loss of coverage occurred more than three years later. Perhaps the employee's employment formally terminated at a much later date, but it is frustrating that the court did not identify that fact." (Employee Benefits Institute of America Inc.)

WHCRA Does Not Require Payment of More than Plan Maximum for Breast Reconstruction, Court Says
Excerpt: "WHCRA requires group health plans that provide medical and surgical benefits for mastectomies to cover breast reconstruction for individuals receiving benefits in connection with a mastectomy. However, the statute permits reconstruction coverage to 'be subject to annual deductibles and coinsurance provisions as may be deemed appropriate and as are consistent with those established for other benefits.'" (Employee Benefits Institute of America Inc.)

Overview: 2005 Version of Publication 502 for Medical and Dental Expenses
Excerpt: "Plan administrators and others who use Pub. 502 to help guide them as to what expenses are for medical care should exercise caution. Some portions of Pub. 502 would provide the wrong result if applied to health FSAs, HSAs, and HRAs." (Employee Benefits Institute of America Inc.)

Special Report: Medicare Pres.cription Drug Plans Offer Meager Savings (PDF)
20 pages. Excerpt: "Families USA looked at Medicare pres.cription drug plan prices for the top 20 drugs prescribed to seniors in 2004 for two regions: 1) Region 5, which covers the District of Columbia, Maryland, and Delaware; and 2) Region 14, which covers Ohio.3 We compared those prices to the prices negotiated by the federal government through the Department of Veterans Affairs (VA)." (Families USA)

Overview: CMS Information for Employers on Retirees' Medicare Part D Auto-Enrollment
Excerpt: "[CMS released two documents] concerning the status of retirees who may be automatically enrolled in Medicare Part D pres.cription drug coverage, and how this could affect their employer-provided retiree health benefits. [The documents are linked to the target page.]" (The ERISA Industry Committee)

Backers of Consumer-Directed Health Care Plans Assess Two Years with HSAs
Excerpt: "ICDC asked industry observers to comment on the effect health savings accounts (HSAs) have had on consumer-directed health (CDH) over the past two years and on the impact they could have on health coverage in the future." (INSIDE CONSUMER-DIRECTED CARE via

Limited Mental Health Parity Extended for One Year
Excerpt: "President Bush last week signed legislation that extends by one year a federal law requiring employers to offer limited parity for mental health care expenses in their health care plans." (Business Insurance)

With Wal-Mart in Their Sights, States Press for Health Benefits
Excerpt: "In a national campaign aimed squarely at Wal-Mart Stores, lawmakers in 30 states are preparing to introduce legislation that would require large corporations to increase spending on employee health insurance, according to the A.F.L.-C.I.O., which planned to announce the initiative this morning." (The New York Times; one-time registration required)

HSA Marketplace
Excerpt: "As of October 2005, only 1% of the population ages 21 to 64 was enrolled in a consumer-driven health plan (CDHP), according to research from the Employee Benefit Research Institute (EBRI) and the Commonwealth Fund. Despite this, insurers and banks have continued to flood the health savings account (HSA) marketplace. Click here for a spotlight of the latest news." (Spencer's Benefits Reports)

Overview: 2005 Version of Form 8889 Released for Use by HSA Account Holders
Excerpt: "The IRS has released the 2005 version of Form 8889 (Health Savings Accounts (HSAs)), which HSA account holders (and beneficiaries of deceased account holders) are required to attach to their Form 1040s to report information about HSA contributions and distributions." (Employee Benefits Institute of America Inc.)

LTC Insurance: With the 'Long' in Long-Term Care Increasing, Americans Worry More, Insure Less
Excerpt: "Americans are becoming increasingly nervous about the simultaneous spikes in the price of long-term care and the cost of insurance to cover it. As a result, more employers may find their employees looking to them for discounted group coverage." (Employee Benefit News)

Abbott Labs Suit Granted Class-Action Status
Excerpt: "A federal judge has granted class-action status to a lawsuit accusing Abbott Laboratories Inc. of cheating older workers out of retirement benefits when it spun off its hospital equipment business in 2004." (The Washington Post; one-time registration required)

Links to Items on Executive Comp, Benefits in General

Overview: FASB Considers Changes to Pensions and Benefits Accounting (PDF)
8 pages. (Milliman)

The FASB Rules on Post-Retirement Accounting Are Changing -- Benefits Could Suffer
Excerpt: "BusinessWeek Associate Editor Anne Tergesen spoke to Bear Stearns accounting analyst Janet Pegg about what investors and pensioners can expect from the proposed changes, which are scheduled to take effect in two stages -- at the end of 2006 and around 2009." (BusinessWeek)

Boomers to Find That Working After 65 Won't Be Easy
Excerpt: "A new Putnam Investments study of work-in-retirement lends strength to those projections: It found that 7 million retired Americans -- about a third -- have returned to work at least 15 hours a week. Most stayed retired for less than a year, with two-thirds reporting that they went back to work because they wanted to, not because they had to." (Pittsburgh Post-Gazette via InsuranceNewsNet)

Five Steps to Implementing a Benefit Portal
Excerpt: "Is your company planning to implement a portal? Are you wondering how to decide to buy or build this technology and how to integrate a portal with your current benefits process? If so, this article will take you through the necessary steps for a successful portal selection and implementation." (Employee Benefit News)

Employer Coalition Seeks Benefits Tax Equity for Domestic Partners
Excerpt: "Some of the nation's largest and best-known employers want to give g.ay and les.bian couples the same tax breaks married couples enjoy in purchasing health insurance. General Mills, Microsoft, and Nike Inc. are among the firms that have joined the Business Coalition for Benefits Tax Equity, organized by the Washington, D.C.-based Human Rights Campaign." (Employee Benefit News)

Groom Law Group Comment Letter to IRS on 409A Proposed Regulations (PDF)
9 pages. (Groom Law Group)

Supporting the Troops -- Employers Maintain Benefits for Deployed Reservists
Excerpt: "The continuation of benefts 'creates a strong bond between the guardsman or reservist and the employer,' says Maj. Robert Palmer, a public affairs officer for Employer Support of the Guard and Reserve, a Defense Department agency responsible for promoting cooperation between employers and military employees. 'It's a good technique for building company loyalty.'" (Employee Benefit News)

Excerpt from 'What Gen X Women Want at Work and How Their Boomer Bosses Can Help Them Get It' (PDF)
6 pages. Excerpt: "According to recent survey results reported in 'The NeXt Revolution: What Gen X Women Want at Work and How Their Boomer Bosses Can Help Them Get It,' they want: 1) positive relationships; 2) interesting work; and 3) lots of opportunities for continuous learning. When these job factors are missing, increasingly Gen X women walk." (Laura Shelton & Charlotte Shelton via

Severance Denied for Employee Who Resigned before Reorganization of His Department
Excerpt: "The US District Court for the District of New Jersey has ruled that an employee who resigned after learning of AT&T Capital Corp's decision to reorganize his department is not entitled to severance benefits." (; one-time registration required)

Newly Posted Events
(Post Yours!)

Health Plan Notices for 2006: COBRA, HIPAA, and More--You Might Need to Change Your Forms or Your Procedures!
Nationwide on January 26, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

Plan Design & Administrative Strategies and Priorities
in California on January 10, 2006
presented by Western Pension & Benefits Conference - Los Angeles Chapter

Newly Posted Press Releases
(Post Yours!)

The Principal Financial Group to Reward Committed Retirement Plan Sponsors; New Principal Advocate Edge Program Offers Special Pricing for Retirement Plans That Spur Employee Savings
(Principal Financial Group)

International Foundation Awarded Contract from DOL
(International Foundation of Employee Benefit Plans)

Assistant Secretary of Labor Combs to Address Fort Wayne, Ind., Workers and Business Leaders on Strength of U.S. Economy
(U.S. Department of Labor, Employee Benefits Security Administration)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Compliance Testing Consultant
for Diversified Investment Advisors
in NY

401(k) Administrators
for Pension International Dynamics, Ltd
in NY

Employee Benefits Tax Senior
for Deloitte Tax LLP
in OH, PA

Employee Benefits Tax Associate (Staff)
for Deloitte Tax LLP
in MI, OH

Employee Benefits Tax Manager
for Deloitte Tax LLP
in PA

Marketing Coordinator - Pension Consulting Services
for RSM McGladrey Inc.
in AZ

Benefits Consultant/Senior Account Manager - Group Health and Ancillary Products - Southern New Jersey (Cherry Hill or Oakhurst)
for Commerce Insurance Services
in NJ

Account Representative - Provider Relations
for 1199SEIU National Benefit Fund
in NY

Pension Analyst - Contract/Temporary
for T. Rowe Price
in MD

Retirement Plan Services - Relationship Manager
for AMCORE Bank
in IA, IL

Defined Contribution Plan Administrator
for Pentec Pension Mgt. Group, Inc.
in TX

Retirement and Securities Specialist
in VA

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Editor and Publisher: David Rhett Baker, J.D.