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| August 21, 2007 |
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The Other Benefits Mess: Government Plans to Reveal Cost of Health-Benefit Promises for the First Time
Excerpt: "Expect states to take a hard look at promised perks. Unlike pension obligations, health-care promises aren't typically guaranteed. Shifting more costs to retirees -- in the form of higher premiums, higher deductibles or reduced benefits -- is an option, just as it has been for private companies." (Kiplinger's Personal Finance magazine via Kiplinger.com)
Gas Prices Affect Recruitment Strategies
Excerpt: "Rising gasoline prices are forcing more employers to consider offering telecommuting and other flexible work arrangements." (Employee Benefit News; free registration required)
Caring for an Aging Parent
Excerpt: "If a parent's need for your caregiving is temporary, that's good news -- at least for now. But if the need for care arises from a permanent change in health status, the question immediately arises: What combination of living arrangements and caregiving is most appropriate?" (Employee Benefit News; free registration required)
Feds Say Most Retiree Health Contributions Are Taxable
Excerpt: "The Internal Revenue Service wants to make it clear that taxpayers cannot normally use retirement plan assets to pay for accident or health coverage on a tax-favored basis." (The National Underwriter Company; free registration or paid subscription required)
Overview: IRS Issues Final Regulations on Qualifying Dependent Care Expenses (PDF)
3 pages. Excerpt: "Hot on the heels of its comprehensive proposed regulations governing cafeteria plans, the IRS has issued final regulations addressing 'qualifying' dependent care expenses. Although the regulations literally address requirements for the dependent care tax credit, the same rules apply for determining qualifying expenses under a dependent care flexible spending account (FSA)." (Lockton Benefit Group)
Overview: IRS Issues New Proposed Regulations for Cafeteria Plans
Excerpt: "On August 6, 2007, the Service withdrew the prior proposed regulations and issued new proposed regulations under Code Section 125. The new proposed regulations clarify and update the rules that have been issued over the last 23 years affecting cafeteria plans and health and dependent care flexible spending arrangements." (Kilpatrick Stockton LLP)
Payment Reform, Info Technology, and Integrated Delivery Essential to Improve Health Care Quality
Excerpt: "From Spencer's Benefits Reports: The great majority of leaders in the health care industry agree that fundamental payment reform (cited by 95% of respondents) and greater organization and integration of care (73% of respondents) are necessary to improve health care quality and efficiency in the United States, the Commonwealth Fund's 11th Health Care Opinion Leaders Survey revealed." (Wolters Kluwer Law & Business)
Overview: After More Than 20 Years, IRS Issues New Proposed Cafeteria Plan Regulations (PDF)
18 pages. Excerpt: "On Monday, August 6, 2007, after an almost 20-year gestation period, the IRS issued long awaited proposed cafeteria plan regulations under Internal Revenue Code ('Code') Section 125 . . . . The New Proposed Regs withdraw the previously issued proposed cafeteria plan regulations, 1.125-1 and -2, . . . replace them with a fresh set of proposed regulations that restate much of the Old Proposed Regs and incorporate both formal and informal guidance issued over the last 23 years." (Alston & Bird LLP)
Cost Concerns Prompt Employers to Take More Active Role in Employees' Health and Well-Being
Excerpt: "Hale and hearty employees save your law firm money. But how much time, money, and resources is your law firm willing to invest to maintain the health of its members and cut costs?' (Institute of Management & Administration via InsuranceNewsNet.com)
Medicare Prescription Drug Benefit Progress Report: Findings from a 2006 National Survey of Seniors
Excerpt: "Compared with seniors covered through employer plans or the Department of Veterans Affairs, Part D enrollees had higher out-of-pocket spending and greater cost-related nonadherence." (Health Affairs)
Medicare Drugs Too Costly for Many, Survey Finds
Excerpt: "Most seniors who lacked prescription coverage in past years now have it, thanks to the Medicare drug benefit, but in a survey released today one in five enrollees said they had put off or even skipped getting some medications because of the program's high costs." (Los Angeles Times)
2007 Segal Medicare Part D Survey of Multiemployer Health Funds (PDF)
2 pages. Excerpt: "The survey found that most multiemployer health funds continue to take the Retiree Drug Subsidy (RDS). Interestingly, the survey confirms something we expected would happen as plan sponsors become more familiar with all of their options in response to the availability of Part D: growth in the number of plans that decided to contract with a prescription drug plan (PDP) or a Medicare Advantage prescription drug (MA-PD) plan." (The Segal Group, Inc.)
Kaiser Permanente HMO CEO Backs California Health Reform
Excerpt: "The chief executive of the biggest health maintenance organization in the United States said on Thursday he backs key elements of California Gov. Arnold Schwarzenegger's proposal to extend health-care coverage to millions of uninsured individuals." (Reuters via Medscape; free registration may be required)
Older Residents Say Premiums Under Massachusetts' Insurance Law Are Unaffordable
Excerpt: "Prices for unsubsidized health insurance plans in Massachusetts can be twice as expensive for older residents as compared to plans available for younger adults, and the state has made no 'special accommodations' for older people to help them comply with the health insurance law, the Boston Globe reports." (Kaiser Family Foundation)
Genetic Testing Used as Basis for Denial of Military Disability Benefits
Excerpt: "'For more than 20 years, the armed forces have held a policy that specifically denies disability benefits to servicemen and women with congenital or hereditary conditions' -- a practice that 'would be illegal in almost any other workplace,' the Los Angeles Times reports." (Kaiser Family Foundation)
HHS Secretary Leavitt Launches Blog To Boost Health Care Discussion
Excerpt: "HHS Secretary Mike Leavitt is taking time in August to blog as a way to foster public discussion. The blog is the result of the Secretary's continuing desire to engage Americans in the exchange of ideas on health care and the provision of human services. It provides an opportunity for the Secretary to share his observations as well as a means for him to have an open conversation about health and the related challenges that face the nation. The blog is intended to be a dynamic online conversation . . . ." (U.S. Department of Health and Human Services)
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Links to Items on Executive Comp, Benefits in General
Outline on Deferred Compensation Arrangements and the Final 409A Regulations (PDF)
45 pages. Excerpt: "As a reaction to certain real and perceived corporate abuses, Congress passed the American Jobs Creation Act of 2004 ('AJCA') on October 11, 2004. The AJCA added Section 409A to the Internal Revenue Code, which completely revamped the rules for 'non-qualified deferred compensation plans.'" (Snell & Wilmer L.L.P.)
Overview: The New Rules for Deferred Comp Arrangements -- A Compliance Strategy for Corporate Counsel (PDF)
11 pages. Excerpt: "The principal purpose of this paper is to outline a strategy that corporate counsel may utilize to assure compliance with the new rules. The new rules are not dealt with in detail, but the common types of arrangements that are potentially covered by the new rules are identified and a very general overview of the new requirements is provided." (Snell & Wilmer L.L.P.)
Conflict in Terms Between ERISA Plan Language and Summary Plan Descriptions - A Circuit by Circuit Synopsis
Excerpt: "When the terms of an ERISA plan and its summary plan description conflict, which terms apply? The answer to this question is another question - which circuit's law governs the dispute? As will be set forth [in the target page], the circuits differ in their conclusions." (Health Plan Law blog by Attorney Roy F. Harmon III)
Overview: All Deferred Compensation Arrangements Must be Amended to Comply with the Final 409A Regulations (PDF)
Pages 2,8 of 8 pages. Excerpt: "The final 409A regulations are applicable to tax years beginning on or after January 1, 2008, and may be relied on for tax years beginning before such date. This makes December 31, 2007, the critical date on which to bring all nonqualified deferred compensation plans and arrangements into compliance with the Code Section 409A requirements. Treasury has indicated that this deadline will not be extended." (Cohen & Grigsby)
What to Do If DOL Comes Knocking at Your Door? - Answers to Some Questions Regarding DOL Audit Process
Excerpt: "EBSA investigators conduct more than 4,000 audits per year. While most of the audits are civil, EBSA investigators also focus on enforcement of federal criminal laws. According to the DoL Web site, almost 75% of EBSA investigations result in a finding of one or more violations of ERISA." (PLANSPONSOR.com; free registration required)
Summary Plan Description Wins Out Against Conflicting Plan Terms
Excerpt: "The 5th U.S. Circuit Court of Appeals has ruled that a summary plan description affording an injured plant operator disability benefits trumps other plan provisions that require 10 years of service before benefit eligibility." (PLANSPONSOR.com; free registration required)
Coalition of More Than 80 Law Firms to Ask IRS for Deferred Compensation Plan Compliance Delay
Excerpt: "Regina Olshan, an employee benefits specialist at law firm Skadden Arps, which is spearheading the effort, said a 'who's who of law firms' was planning to send a letter to IRS acting commissioner Kevin Brown Tuesday morning seeking the delay. The 'very short' letter requests an extension of 409A compliance to Dec. 31, 2008, from the same date this year, she said." (Financial Week; free registration required)
Newly Posted Press Releases
The Standard Releases Managed Account Study
Standard Insurance Company
NBCH Releases eValue8 Report on Health Plans' Performance around HHS' Four Cornerstones of Value-Driven Health Care
National Business Coalition on Health
People Face More Stress As Out-of-Pocket Costs for Benefits Rise and Retirement Savings Rates Fall
Ameriprise Financial
The New American Workforce: Older Workers
Employment Guide
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