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January 12, 2006
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Kentucky Governor's Plan Would Help Small Employers Buy Health Insurance
Excerpt: "Small businesses in Kentucky that want to begin offering health insurance to their workers could get monthly reimbursements of $40 to $60 per employee under a plan Gov. Ernie Fletcher announced in his State of the Commonwealth address Monday night." (The Courier-Journal)

Cutting Drug Co-Pays Lowers Costs for Insurers
Excerpt: "It may seem counterintuitive, but a new study finds that by eliminating patient co-payments for cholesterol-lowering statins, health insurers could actually save more than $1 billion a year in hospitalization costs." (HealthDay News via Yahoo! News)

Integrating Health and Disease Management a Matter of Dollars and Sense
Excerpt: "Integration of health management and disease management into a single continuum of care seems to be gaining traction. The topic has dominated the industry conference circuit and is shaping the creation of new health products such as integrated health assessment tools. [F]our industry leaders to get their perspective on this trend." (Employee Benefit News)

Making the Case for Online Health Care
Excerpt: "In his speech to the JP Morgan audience, [Steve] Case argued that the Internet has transformed a wide range of consumer decisions, from choosing a mortgage to buying a used car to investing in stocks. Still, he noted of the health care system, 'There is one major industry that remains immune to change and that industry happens to be the largest in America.' " (eWEEK)

Spreading the Pitney Bowes Approach to Health Care Benefits
Excerpt: "Pitney Bowes and a small but growing band of imitators (more than 30 companies at last report) have begun a revolution in the design and management of employer-sponsored health benefits with the objective of realizing much greater value from these benefit plans, for both themselves and their employees." (Employee Benefit News)

Tighten Co-Pays to Reflect Medical Value
Excerpt: "Employers should ... base medical co-pays on the scientific likelihood that the treatment will improve the patient's health, says Dr. Mark Fendrick, an internist and associate professor of health management and policy at the University of Michigan. In his scenario, employees would pay less for tests, drugs and services with a higher clinical value and solid evidence-base, but pay more for those with a lower probability of success." (Employee Benefit News)

Study Shows More Workers Pay for Health Care
Excerpt: "A shrinking number of U.S. employees work at companies offering to pay their entire monthly bill for healthcare coverage, with the largest drop occurring in big companies, according to a government report released Wednesday. " (Los Angeles Times via BlueCross BlueShield Association)

Overview: Most Employers Must Disclose Drug Coverage to CMS by March 31 (PDF)
3 pages. Excerpt: "This Alert explains the key points in the CMS guidance and disclosure form, including: who are the affected and exempted employers, what are the deadlines for different plan years, how many forms are required to be submitted." (Aon Consulting)

Can the Boss Insist on Healthy Habits?
Excerpt: "In 2006, Weyco employees who refuse to take mandated medical tests and physical examinations will see their monthly health insurance premiums jump by $65. By next year, their annual insurance bills will grow by more than $1,000 if they still fail to follow instructions." (The Christian Science Monitor)

Mandated Health Screenings Reap Rewards
Excerpt: "Cadmus Communications has taken a radical approach to employee wellness: It requires employees to take a health risk assessment, blood pressure screening and cholesterol screening. Seventeen employees at the publishing services company in Richmond, Va., lost their health coverage in 2005 because they didn't cooperate." (BenefitNews Connect)

Employer-Based Smoking Cessation Programs Give Smokers Extra Power to Kick the Habit
Excerpt: "Although some employers are taking a hard line against smokers - raising premiums or terminating employees who continue to smoke ..., others are opting to follow the old adage, 'You catch more flies with honey than vinegar,' offering comprehensive smoking cessation programs." (Employee Benefit News)

The Consumer-Directed Health Plan Market: Implications of New Benefit Designs (PDF)
15 pages. Excerpt: "This document summarizes a qualitative research project conducted with a sample of 11 managed care medical directors and product managers, and two benefit design consultants. The analysis has been augmented with an extensive review of secondary materials, and several important sources have been noted in the text. These findings provide a directional assessment of current industry views on the CDHP market." (The Zitter Group)

WSJ Examines Health Insurers' Use of Personalized Statements to Increase Health Care Cost Awareness
Excerpt: "The Wall Street Journal [January 10, 2005] examined how some insurers have begun mailing personalized health 'statements' to their members as a way to make consumers more conscious of the cost of health care. The statements ... include details about members' health coverage, such as patient spending, the status of insurance claims, how much has been applied to their deductible and how much is available in a financial account for health expenses." (Kaiser Family Foundation)

Links to Items on Executive Comp, Benefits in General

FASB to Issue a Proposed FSP Related to FAS123(R) on Options
Excerpt: "At its meeting [January 11, 2006], the Financial Accounting Standards Board ... voted to proceed with issuing a proposed FASB Staff Pronouncement ... related to FAS123(R), Share-Based Payment ... to address the classification of options or similar instruments granted as employee compensation that allow for cash settlement upon the occurrence of a contingent event." (Financial Executives International)

Overview of FAS 123R Valuation: Considering Historical Life in Developing Expected Life
Excerpt: "There are many reasonable ways to determine the fair value, but all involve making assumptions about the option holder's expected behavior and the company's financial outlook. It is now more important to develop these assumptions, and thus the option's fair value, as rigorously and as accurately as possible." (CCA Strategies, LLC)

Overview: GASB 43 & 45 -- Accounting, Reporting and Disclosure Requirements for Government OPEBs
Excerpt: "The new standards outlined in GASB 43 and 45 have the potential for tremendous increases in the expenses and liabilities reported in the financial statements of many government entities. Here [CCA Strategies reviews] these and other implications of the new standards." (CCA Strategies, LLC)

Retired United Airlines' Pilots Want Recount
Excerpt: "Retired pilots of United Airlines are demanding a recount of the votes cast for the airline's Chapter 11 plan of reorganization. In an emergency motion submitted Monday to the U.S. Bankrup.tcy Court in Chicago, the United Retired Pilots Benefit Protection Association said the company failed to count the votes of more than 1,500 retired pilots because they sought to recover lost pension benefits in greater amounts than reflected on the ballots." (AP via The New York Times; one-time registration required)

Overview: DOL Issues Final USERRA Regulations
Excerpt: "Employers should confirm that their military leave policies are consistent with the final regulations, make appropriate additions and adjustments to those policies, and post the revised informational notice in appropriate locations." (Ballard Spahr Andrews & Ingersoll, LLP)

United CEO Could Get $15M in Incentives; Other Executives to Share $152 Million
Excerpt: "'Such compensation for executives is outrageous considering the sacrifices other employees have made,' said Joseph Tiberi, a spokesman for the International Association of Machinists and Aerospace Workers. 'Our members alone will have sacrificed more than $4.6 billion' in wages, benefits and pensions." (AP via The Washington Post; one-time registration required)

Employers Adapt Global Executive Pay Plans to Local Markets
Excerpt: "CEOs in the United States continue to enjoy the largest and most comprehensive pay packages, both in terms of base compensation and total remuneration while CEOs in France, Germany, Italy, Switzerland and the United Kingdom command higher levels of total compensation than their peers in the rest of the world." (; one-time registration required)

Pay-for-Performance Programs Can Improve Care to Diabetics
Excerpt: "As health insurers incorporate more diabetes process and outcomes measures into their physician pay-for-performance (P4P) programs, some are reporting significant improvements in the quality and cost of care provided to diabetics." (INSIDE DISEASE MANAGEMENT via

Overview: Post-Severance Compensation
Excerpt: "Until recently, there was no IRS guidance on post-severance compensation. When an employee received a severance package, arguably, the employer had wide latitude in allowing post-severance compensation to be included for qualified plan purposes. It was not uncommon for post-severance compensation to count towards deferrals, matches, and other employer contributions for periods of up to six months or sometimes even longer." (McKay Hochman Co., Inc.)

Newly Posted Events
(Post Yours!)

Annual Spring Employee Benefits Law and Practice Update
Nationwide on April 6, 2006
presented by ALI-ABA (American Law Institute-American Bar Association)

Newly Posted Press Releases
(Post Yours!)

ERISA Section 4010 Reporting Waived For Certain Employers
(Pension Benefit Guaranty Corporation (PBGC))

Trustmark Introduces Integrated Healthy Foundations Approach to Consumer-Directed Healthcare

The Principal Financial Group Streamlines Retirement Plan Management for Sponsors
(Principal Financial Group)

Enlightened California Employers Offer Health Advocates to Help Retirees with Medicare Prescription Drug Benefit

Blurred Lines Between Prescription Drug Treatment and Health Care Make Carefully Designed Pharmacy Benefit Plans Essential
(International Foundation of Employee Benefit Plans)

For Immediate Release: CPI Announces Retirement Plan Consultant for Chicago Area
(CPI Qualified Plan Consultants, Inc.)

Liberty Mutual Adds Assistance Programs to Group Disability and Life Policies; Counseling, Financial and Legal Services Help Employees Stay Focused and Productive
(Liberty Mutual)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Plan Administration Specialist
for Boston Financial Data Services
in MA

MetLifeŽ Employee Benefits Sales and Enrollment Specialist
for MetLifeŽ
in CA

Implementation Manager
for Great-West Financial Services
in CO

Benefits Analyst
for Automobile Club of Southern California
in CA

Benefits Manager
for Automobile Club of Southern California
in CA

DB Benefits Operations Manager
for Hewitt Associates
in NJ

HM Benefits Operations Manager
for Hewitt Associates
in NJ

401(k)/Executive Deferred Compensation Plan Administrator (Contractor Position Approx. 3 month Temp Assignment)
for Synopsys, Inc.
in CA

DC Benefits Service Manager
for Hewitt Associates
in NJ

Retirement Service Specialists
for Constantin Control Associates
in GA, RI

Employee Benefit Service Specialist
for CUNA Mutual Group
in CA

Defined Contribution/ 401(k) Administrator
for Gary Mann & Associates, Inc.
in IL

Paralegal - Retirement Plans
for Ward Rovell, Professional Association
in FL

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