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August 7, 2007
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Sponsored by: Employee Benefits Institute of America Inc. (EBIA)

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Overview: IRS Revives Long-Dormant Cafeteria Plan Rules With New Proposed Regulations (PDF)
4 pages. Excerpt: "The Internal Revenue Service (IRS) recently withdrew numerous old proposed cafeteria plan regulations and guidance, some of which dated all the way back to 1984, and issued five new proposed regulations that update and expand the rules that govern the design, operation, and nondiscrimination rules applicable to cafeteria plans under Internal Revenue Code section 125." (Morgan, Lewis & Bockius LLP)

U.S. Grocer Publix to Offer 7 Antibiotics for Free
Excerpt: "Publix, which is based in Lakeland, Florida, said it would give out amoxicillin, ampicillin, cephalexin, ciprofloxacin (excluding ciprofloxacin XR), erythromycin (excluding Ery-Tab), sulfamethoxazole/trimethoprim (or SMZ-TMP) and penicillin VK. Customers must bring in a prescription to get up to a 14-day supply for free." (Reuters Life! via Medscape; free registration may be required)

Overview: IRS's New Proposed Cafeteria Plan Regulations (PDF)
10 pages. Excerpt: "The rules - articulated in 124 pages - affect employers who sponsor a cafeteria plan, employees who participate in a cafeteria plan, and third-party cafeteria plan administrators. For the most part, the rules will take effect for plan years beginning on or after January 1, 2009; however, employers may begin relying on the rules immediately." (Miller & Chevalier Chartered)

TPA Assessed Fees and Costs for Improper Removal of Employer's State Law Claims
Excerpt: "Following a successful motion to remand, an employer prevailed on a motion for attorneys' fees and costs. The primary case wherein the district court held that the employer's state law claims against its third party administrator were not preempted is Taylor Chevrolet, Inc. v. Medical Mut. Services, LLC, Slip Copy, 2007 WL 1452618 (S.D.Ohio) (May 15, 2007)" (Health Plan Law blog by Attorney Roy F. Harmon III)

Managing Catastrophic Conditions Saves Employers 18% on Health Care Expenditures
Excerpt: "From Spencer's Benefits Reports: Managing catastrophic conditions, providing cash incentives, and improving administration and communications all contribute to lower health care benefit expenses, according to SHPS's 2007 Health Practice Study: What Every Self-Insured Employer Should Know." (Wolters Kluwer Law & Business)

Insurers Call for Employers to Pay 100% of Premiums and Cost Per Worker Could Fall
Excerpt: "Going against the trend of making workers pay more for their health care, the Texas Association of Health Underwriters is expected today to call for a change in state insurance law that provide for plans requiring employers to pay 100 percent of employee insurance premiums." (The Dallas Morning News; free registration required)

House Subcommittee Considers Federal Remedies to Ensure Prompt Health Plan Payments
Excerpt: "The Subcommittee on Regulations, Health Care and Trade is discussing federal pay law fixes that include implementing national uniform standards at an Aug. 1 hearing." (Health Plan Week via AISHealth.com)

Aetna Accused of Reducing Out-of-Network Benefits
Excerpt: "Aetna Inc. is facing a lawsuit that claims members received lower health insurance benefits because Aetna units improperly calculated the usual, customary and reasonable fees for out-of-network providers." (PLANSPONSOR.com; free registration required)

The Sereboff Decision: How it Affects Health Plans' Ability to 'Follow the Money' (PDF)
4 pages. Excerpt: "Apparently Deep Throat was right. His proven method of 'following the money' to ferret out political scandals has recently been employed to solve one of ERISA's most nettlesome problems: Can an employer-sponsored medical plan force a participant to repay it after the participant has been reimbursed by another for these same plan expenses?" (Jones Day)

Commonwealth Fund/Modern Healthcare Health Care Opinion Leaders Survey on Health Care Quality/Safety
Excerpt: "Read an analysis of the findings in a Data Brief, as well as two related commentaries, Quality Is in Our Hands by Tommy G. Thompson, Independent Chairman, Deloitte Center for Health Solutions, Former U.S. Secretary of Health and Human Services, and Many Challenges Await by Donna E. Shalala, President, University of Miami and Former Secretary of Health and Human Services." (The Commonwealth Fund)

San Jose to Tackle Retiree Health Costs as City Now Must Account for Expense
Excerpt: "Even by the standards of government work, it's a generous benefit. Put in 15 years with San Jose and when you retire, the city pays all or most of your family's health care premiums for the rest of your life." (San Jose Mercury News)

Los Angeles Times Series Examines Pharma.ceutical Industry Influence on Physicians, Consumers
Excerpt: "The Los Angeles Times on [August 6] featured a series of articles titled 'Sold on Drugs' that examines the effect of drug manufacturers' marketing techniques on physicians and consumers." (Kaiser Family Foundation)

Employer Group's Summary of DOL Report of Comments about FMLA (PDF)
2 pages. Excerpt: "The Report . . . highlighted both employer and employee concerns with the FMLA. While the employer groups focused on concerns in administering the FMLA regulations, the employee groups recommended that the FMLA should be expanded to provide paid leave, more time off, and coverage for siblings and grandparents. Here is a summary of the issues that DOL considered to be the most important, especially for the employer community." (The National Coalition to Protect Family Leave)

Health Blog: A La Carte Health Insurance Stirs Controversy
Excerpt: "Employers and insurers are split over whether the growth of individual health insurance in the workplace is a good idea -- or even legal. The WSJ's Chad Terhune reports on Paul Zane Pilzer, an entrepreneur in Utah, who is an evangelist for the idea that employers should stop providing group health insurance and help employees get individual policies instead." (The Wall Street Journal Online)


Links to Items on Executive Comp, Benefits in General

Text of IRS 'Frequently Asked Questions' Document for School Teachers About Effect of Section 409A (PDF)
4 pages; dated 8/7/2007 (no document number specified). Excerpt: "The questions and answers below explain that, for purposes of section 409A: [i] School districts are not required to offer their employees an election between being paid over the school year and being paid over a 12-month period [ii] School districts that choose to offer such an election need not make any changes prior to 2008 and their employees will not be subject to additional taxes [and iii] Any changes required for 2008 are likely to be minor." (Internal Revenue Service)

Global Report, Second Quarter 2007, Shows Moderate Reforms (PDF)
7 pages. Excerpt: "As the talent pool shrinks in certain countries due, in part, to aging populations and global labor mobility, many of these reforms address opening the labor market while protecting employees' rights and keeping the retirement and health care systems sustainable." (Hewitt Associates)

Overview: IRS to Define Severance Pay Plan, Substantial Risk of Forfeiture Under Code Sec. 457
Excerpt: "The IRS has announced that it intends to issue guidance, applicable to nonqualified deferred compensation plans of state and local governments and tax exempt entities under Code Sec. 457, which will define the terms 'bona fide severance pay plan' and 'substantial risk of forfeiture.'" (Wolters Kluwer Law & Business)

Overview: SEC's Rules on Executive Compensation: Illuminating the Disclosure Requirements
Excerpt: "The disclosures required under the previous rules did not adequately reflect how executive compensation packages have evolved and increased in complexity over time. The amended rules are intended to better disclose these new forms of compensation and provide sufficient flexibility to address additional forms and types of compensation as developed in the future." (The New York State Society of CPAs)

A Reasonable Approach to Severance and Change-in-Control Payments
Excerpt: "The areas for reconsideration include: Full or partial gross-ups triggered by a change-in-control event; Age, service or formula enhancements for supplemental executive retirement plans (SERPs) triggered by either severance or a change-in-control event; Full-cash severance payouts rather than those that sunset after a period of service; Full protections for any termination following a change-in-control event; Single-trigger equity vesting at a change-in-control event." (Watson Wyatt Worldwide)

Court Rejects General Evidence Regarding Mailing Procedures for Summary of Material Modifications
Excerpt: "EBIA Comment: The courts are not always this demanding in terms of proof of mailing, but as this outcome illustrates, generalized evidence of mailing procedures may not always be enough. In our view, employers (and third-party service providers that mail required materials) should be prepared to produce particularized descriptions of company mailing procedures -- showing that materials were simply delivered to the company mailroom may not be sufficient." (Employee Benefits Institute of America Inc.)


Newly Posted Events

Dealing With Documents - The New EGTRRA Updating Rules Under Rev. Proc. 2007-44
Nationwide on September 12, 2007
presented by American Society of Pension Professionals & Actuaries (ASPPA)

ERISA Claims Fundamentals
in Florida on February 13, 2008
presented by West Legalworks

ERISA Claims Fundamentals Workshop
in New York on October 24, 2007
presented by West Legalworks

Plan Administration Workshop with Joan Gucciardi, MSPA, CPC, MAAA, Summit Benefit & Actuarial Services
in Pennsylvania on September 7, 2007
presented by ASPPA Benefits Council of Delaware Valley

The Eight Benefits Conversations: Recalibrating Health and Welfare Teleweb
Nationwide on August 23, 2007
presented by International Foundation of Employee Benefit Plans


Newly Posted Press Releases

Communication, Information Tools Critical to Success of Consumer-Directed Health Plans, Watson Wyatt and RAND Corporation Study Finds
Watson Wyatt

New Rule Will Not Affect Teacher Salaries in Upcoming School Year
Internal Revenue Service (IRS)

Report Subscriptions, ACH Processing, and Payment Updates Mark Summer Upgrade of Travis Software's WebCOBRA.com
Travis Software Corp.

USA Today Names NCOA's BenefitsCheckUp.org a Cyberspace "Gem"
National Council on Aging (NCOA)

Transcend Technologies Group Partners with HRAnswerLink to Enhance Group Benefits Manager(TM) with HR Compliance Tools
Transcend Technologies Group, Inc.

SPARK Institute Comments To Congress, DOL & SEC About Concerns With "401(k) Fair Disclosure Retirement Security Act"
The SPARK Institute


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