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| October 23, 2008 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
Today's sponsor is Employee Benefits Institute of America (EBIA)
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| EBIA's In Person Seminar Series |
| EBIA's In Person seminars provide education on employee benefits topics to professionals, including TPAs, attorneys, benefits consultants, human resources managers, plan administrators, insurance professionals, and accountants. For information about CE credit, course materials, speakers, locations, and agenda details, and to register, please visit EBIA's In Person Seminars. |
[Guidance Overview] Mental Health Parity Legislation Enacted (PDF)
3 pages. Excerpt: "After more than a decade of deliberation and repeated extensions, mental health parity requirements for group health plans became permanent on October 3 as part of the Emergency Economic Stabilization Act (H.R. 1424) (the 'Act'). The Act also added additional parity requirements for mental health benefits and requires parity in the treatment of substance use disorder (i.e. substance abuse) benefits as well." (Powell Goldstein LLP)
[Guidance Overview] Seventh Circuit Holds Plan Language Controls Over Administrative Practice
Excerpt: "[T]he Seventh Circuit in Orth explored two defenses offered by plan fiduciaries as justification where the plan language failed to comport with the plan administrator's administrative practices. The opinion, authored by Judge Posner, reaches the conclusion that neither theory advanced by the defendants had merit." (Health Plan Law blog by Attorney Roy F. Harmon III)
[Guidance Overview] Nursing Relatives in Germany: New Leave Entitlement
Excerpt: "Nursing relatives in need of care often demands a great deal of someone. A new law has been enacted in Germany that protects employees who require leave from work to care for relatives against hindrances from their employers. The Nursing Leave Act ('Pflegezeitgesetz') is a novelty in German law. As of 1 July 2008, employees have the right to claim time off in order to look after relatives in need of care -- so-called 'nursing leave.' Relatives include not only members of the immediate family but also grandchildren, grandparents and parents-in-law. However, the new law only applies if the relatives are seriously dependent on care." (Faegre & Benson LLP)
[Guidance Overview] Transfer of Surplus Funds by Terminated Welfare Plan Did Not Violate ERISA
Excerpt: "If a trust sponsored by a multiemployer welfare plan is properly terminated and all claims are either paid or properly forfeited, the proposed subsequent transfer of surplus funds to a charity by the trustees of that trust is not a prohibited transaction involving either a party in interest or a fiduciary within the meaning of ERISA §406(a)(1)(d) or ERISA §406(b) , according to an EBSA advisory opinion." (Wolters Kluwer)
[Guidance Overview] Judge Approves Settlement of Suit Against Aetna Over Coverage for Eating Disorders
Excerpt: "[T]he settlement affects only patients in 'fully insured' plans -- those funded by employers. Enrollees in self-funded plans, such as employee welfare and state worker health benefits programs, are not covered by the settlement and would not automatically benefit from the more liberal process." (Law.com)
Aetna and Microsoft To Partner on Personal Health Records Project
Excerpt: "On Monday, officials from Aetna and Microsoft announced plans to partner for a new program that will allow about six million Aetna members access to their personal health records online, the AP/Minneapolis Star Tribune reports (Murphy, AP/Minneapolis Star Tribune, 10/22). The project will launch in November. Under the program, Aetna members who currently have PHRs offered by the health insurer can transfer their medical information to Microsoft HealthVault accounts (Rubenstein, Wall Street Journal, 10/22)." (California HealthCare Foundation)
Young Workers Must Face Realities of Long-Term Care
Excerpt: "Most of the nation's 78 million baby boomers are watching their parents grow old. While investigating caretaking options for their parents, they should also be thinking about their own old age and planning how they will pay for nursing homes or home health aides for themselves, experts say. With life expectancy steadily rising, the odds are that they will eventually need some help with basic functions, like dressing or walking, maybe for decades." (The New York Times; free registration required)
China Issues Clarifying Measures for Paid Annual Leave
Excerpt: "A law regarding paid annual leave that has been in effect since January 1, 2008 has been clarified with new implementation measures. These new measures came into force on September 18, 2008." (Watson Wyatt Worldwide)
Chrysler Salaried Retirees Worry That a Merger May Cost Them Health, Pension Benefits
Excerpt: "Many Chrysler salaried retirees are fretting that a possible merger between the beleaguered automaker and its larger rival, General Motors Corp., could result in a loss of some health care and pension benefits. Among their top concerns is that GM or any other company that might acquire the Auburn Hills automaker would end payment of a $1,805 stipend doled out each year to salaried retirees to cover health care costs for those 65 and older. Chrysler began the yearly payments after it cut retiree health benefits last year in a cost-savings move to slash expenses of its salaried employees." (The Detroit News)
Vision Care: Focusing on the Workplace Benefit (PDF)
9 pages. Excerpt: "The Vision Council has compiled Vision Care: Focusing on the Workplace Benefit to explore the value of vision benefits for both employees and employers. Healthy vision for employees means better quality of life while for employers it can mean a healthier workforce, higher productivity and fewer absences. Offering vision coverage can be an additional way to attract quality employees." (The Vision Council)
The Candidates' Health Care Fixes: Plan vs. Plan
Excerpt: Sens. John McCain and Barack Obama have each offered sweeping, and contrasting, prescriptions for how to reform the health-care system. In last week's presidential debate, the two clashed over how their policies would affect the Ohio plumber, whom Sen. McCain has showcased as a sort of Everyman American. But the two health plans would have very different effects on various groups. The impact depends on factors such as your income, health status and what kind of insurance you currently have, if any.'" (The Wall Street Journal)
Health Insurers Look To Open Banks as More People Enroll in Health Savings Accounts
Excerpt: "The Los Angeles Times on Wednesday, in the second installment of a three-part series about the U.S. health insurance system, examined a 'fundamental change' in the health care industry: 'Insurers are moving away from their traditional role of pooling health risks and are reinventing themselves as money managers -- providers of financial vehicles through which consumers pay for their own health care.'" (Kaiser Family Foundation)
[Opinion] ERISA, Bargaining Agreements, Health Plans and Oral Modifications
Excerpt: "A recent Seventh Circuit decision was interesting not so much because it addressed the vesting issue, it didn't, but because it dealt with a retiree health care plan the employer could alter, but didn't do so validly." (Our Own Point of View)
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Links to Items on Executive Comp, Benefits in General
[Guidance Overview] India's Fringe Benefit Tax: Common Issues
Excerpt: "In April 2007, the Indian government imposed a fringe benefit tax (FBT) on the allotment or transfer of shares by a company to its employees under an employee stock option plan. In October 2007, the Central Board of Direct Taxes (CBDT) issued rules prescribing the method of valuing stock options subject to the tax. This Client Alert is a reminder about the previously approved tax law changes and the fact that employers in India generally must accrue and remit the taxes once the options begin vesting (even though they may not be exercised until some later date)." (O’Melveny & Myers LLP)
[Guidance Overview] When The Going Gets Tough, Executive Deferred Compensation Issues Get Tougher
Excerpt: "This article discusses some issues that may arise under section 409A and other laws during an economic squeeze and what they can mean to nonqualified deferred compensation plans such as a SERPs, synthetic equity, or severance agreements." (Chang, Ruthenberg & Long PC)
An Overview of the Railroad Retirement Program (PDF)
11 pages. Excerpt: "The Railroad Retirement program was established in the 1930s. It provides retirement, survivor, unemployment, and sickness benefits to individuals who have spent a substantial portion of their career in railroad employment, as well as to these workers' families. This article describes the history, benefit structure, and funding of the Railroad Retirement program." (U.S. Social Security Administration)
Labor Supply Effects of the Interaction between the Social Security Disability and Retirement Programs at Full Retirement Age
Excerpt: "The Social Security Disability Insurance (DI) program imposes strong work restrictions on beneficiaries; however, the causal effect of the work disincentives on labor supply has been difficult to estimate. We take a new look at this question by exploiting the fact that DI benefits are payable only until full retirement age (FRA), at which point they are converted to retired worker benefits, and the program's implicit high marginal tax rate on earnings is abruptly relaxed." (University of Michigan Retirement Research Center)
Bailout Bill Hones Ax Over Executive Pay
Excerpt: "The big bank bailout doesn't just take aim only at excessive severance packages for top executives of financial companies, as has been widely reported. The limitations Congress has mandated apply to other elements of bailed-out financial institutions' pay packages, and they could potentially apply to those of other publicly traded companies in the not-too-distant future. The provision that may have the greatest impact on financial firms is a new $500,000 deductibility limit that will apply to all forms of compensation for top officers." (Workforce Management; free registration required)
How TARP May Impact All Executive Compensation Disclosures
Excerpt: "'At our '3rd Annual Proxy Disclosure Conference' yesterday, Corp Fin Director John White delivered an important speech - entitled 'Executive Compensation Disclosure: Observations on Year Two and a Look Forward to the Changing Landscape for 2009' - during which John talked briefly about how the TARP's executive compensation provisions could potentially spill-over and impact the many companies not directly subject to TARP." (From the CorporateCounsel.net Blog via Attorney B. Janell Grenier via Benefitsblog.com)
Newly Posted Events
Is the San Francisco Health Care Security Ordinance a Roadmap for States to Avoid ERISA Preemption?
Nationwide on November 18, 2008
presented by ABA Joint Committee on Employee Benefits
Section 403(b) Compliance Countdown
Nationwide on November 13, 2008
presented by ABA Joint Committee on Employee Benefits
Newly Posted Press Releases
PSCA Announces New 401k.org Web Site
Profit Sharing/401(k) Council of America (PSCA)
PBGC Assumes Pope & Talbot Inc. Pension Plan
Pension Benefit Guaranty Corporation (PBGC)
U.S. Labor Department Recovers $8.6 Million For Workers In Settlement Involving Agway 401(k) Plan In New York
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Mutual of Omaha Offers 401k Toolbox® to Help Protect Investors
Mutual of Omaha
Morningstar Investment Services Announces Morningstar(R) Managed Portfolios Retirement Income Series
Morningstar, Inc.
Study Confirms the Business Case for Employer-Sponsored Child Care
Bright Horizons Family Solutions
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