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| February 18, 2009 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
Today's sponsor is International Foundation of Employee Benefit Plans
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| Be Smart by Association with the International Foundation |
| Smart is not a permanent state of being. What's your maintenance plan? Take advantage of the education and information available through the International Foundation of Employee Benefit Plans, a nonprofit educational association, and find out why over 35,000 industry professionals like Ken Bradshaw, CEBS rely on the Foundation to stay informed and educated. Make sure you have the most comprehensive information on health, pension and compensation issues. Be smart by association. |
[Guidance Overview]
COBRA Subsidy in Stimulus Package to Benefit Involuntarily Terminated Employees
Excerpt: "The COBRA provisions of the American Recovery and Reinvestment Act of 2009 (the 'Act') provide for an employer subsidy of COBRA premiums for involuntarily terminated employees. The new law will have a substantial impact on employers' ongoing obligations under COBRA. This Management Alert summarizes the COBRA provisions of the economic stimulus bill and discusses how employers may be impacted by the new law." (Seyfarth Shaw LLP)
[Guidance Overview]
Stimulus Package Modifies COBRA, HIPAA, and Other Welfare Benefit Provisions
Excerpt: "ARRA includes other provisions that affect health and other welfare benefit arrangements. For example: Qualified Transportation Fringe Benefits. ARRA increases the monthly limit on benefits for transit passes and vanpools to the same amount as the limit for qualified parking. For 2009, that means an increase from $120 to $230 per month. This increase will be in effect from March 2009 through December 2010." (Ballard Spahr Andrews & Ingersoll, LLP)
[Guidance Overview]
Stimulus Bill Provision of Subsidized COBRA Coverage
Excerpt: "The massive stimulus package will subsidize COBRA coverage for some eligible qualified beneficiaries. The COBRA provisions will take effect soon after enactment and so require prompt attention and action from plan sponsors and administrators. Among other actions, employers must issue updated COBRA notices, provide new enrollment options and implement subsidy procedures." (Watson Wyatt Worldwide)
[Guidance Overview]
Immediate COBRA Action As Required by Stimulus Plan Provisions (PDF)
8 pages. Excerpt: "The new provisions will result in, among other things: 'Second chance' COBRA elections; New election options; Revised COBRA notices; Modified COBRA invoices; Interactions with payroll tax deposit mechanisms to fund the 65% subsidy; New reporting to the Secretary of Treasury and assistance-eligible individuals; Adverse individual income tax consequences for assistance-eligible individuals who earn too much income in 2009 or 2010." (Morgan, Lewis & Bockius LLP)
[Guidance Overview]
Stimulus Bill Dramatically Modifies HIPAA Rules: Business Associates and Covered Entities Must Address New Requirements
Excerpt: "[The American Recovery and Reinvestment Act] contains surprising modifications to HIPAA's Privacy and Security Rules. These changes will likely require every business associate agreement to be modified. The Act also, for the first time, requires business associates to comply directly with many of HIPAA's rules and subjects business associates to HIPAA's civil and criminal penalties. The Act increases the penalties for various HIPAA violations and dramatically expands other remedial actions (such as increasing federal government audits; granting attorneys fees in some HIPAA lawsuits; and allowing a method for individuals to recover penalties under HIPAA). The changes are significant to all covered entities, but are most challenging for business associates, who now face a host of new requirements." (Michael Best & Friedrich LLP)
[Guidance Overview]
New COBRA Changes Require Prompt Employer Action With Little Government Guidance
Excerpt: "The burden of administering and, to some extent, paying for this subsidy falls on employers that sponsor group health plans, especially those that sponsor self-insured arrangements where premiums will generally not cover the entire cost of providing benefits. Further, employers (and in some cases, COBRA third party administrators) must respond immediately to these new requirements without the benefit of IRS and Department of Labor guidance on many issues. Once President Obama signs ARRA, the new rules are effective immediately, and premium subsidies become available for periods of coverage beginning on and after the date of enactment. For most plans, that will be March 1, 2009, thereby requiring swift administrative changes by employers and their COBRA administrators." (McGuireWoods LLP)
[Guidance Overview]
COBRA Changes in Economic Stimulus Package
Excerpt: "Because the law applies to employees who were involuntarily terminated since September 1, 2008, all such employees who did not previously elect COBRA will now be provided with a new 60-day election period during which they can prospectively elect the newly subsidized COBRA coverage. Any COBRA continuation coverage that is elected during the special election period begins on March 1 and does not apply retroactively to any prior period." (Faegre & Benson)
[Guidance Overview]
New COBRA Rules (PDF)
9 pages. Excerpt: "The economic stimulus bill passed by Congress -- the American Recovery and Reinvestment Act of 2009 (H.R. 1) -- contains a significant modification of the COBRA continuation coverage rules, which is generally effective March 1, 2009. Very generally, under the bill, individuals who become eligible for COBRA by reason of an involuntary termination of employment during the September 1, 2008 and December 31, 2009 period are only required to pay 35% of the COBRA premium. The remainder of the premium is generally subsidized by the employer, which is reimbursed through a payroll tax credit. With respect to any individual, this subsidy expires can last up to nine months. High-income individuals generally must repay the subsidy through a recapture tax." (Davis & Harman LLP via American Benefits Council)
[Guidance Overview]
Summary of Key COBRA Provisions in the American Recovery and Reinvestment Act, H.R. 1 (PDF)
2 pages. Revised February 17, 2009. (American Benefits Council)
Medical Encyclopedia Gives Patients New Source for Health Info Online
Excerpt: "A no-cost online medical encyclopedia, Medpedia, went live today, the New York Times reports. Unlike other online encyclopedias, only trained medical professionals will be permitted to write and edit the site. Each author will have a contributor page that details his or her experience and qualifications. Harvard Medical School, the National Health Service, CDC, the University of California-Berkeley's School of Public Health and others have agreed to give thousands of pages of information to the site." (California HealthCare Foundation)
Class Actions Suits Alleged Improper Reimbursement of Out of Network Providers
Excerpt: "Two new cases involving the Ingenix database have been filed in the New Jersey federal district court, one against CIGNA and the other against Aetna. The plaintiffs are the AMA, several state medical associations and several individual physicians. The plaintiffs seek class action status for the litigation, and base their claims on RICO, ERISA and the Sherman Act." (Health Plan Law)
Spencer's Benefits Reports Begins Collecting Data for COBRA Continuation of Coverage Survey
Excerpt: "Survey forms are available online (visit http://www.zoomerang.com/Survey/?p=WEB228QV6HWKSS to complete the survey). Spencer's Benefits Reports has been collecting and analyzing COBRA survey information since 1990. This year's survey requests information concerning the costs, administrative procedures, and problems associated with COBRA." (Wolters Kluwer)
Workplace Lactation Programs
Excerpt: "Working mothers with infants sometimes face a myriad of barriers in balancing work with home life. For some, especially hourly and lower-wage workers, that includes access to a workplace lactation room. Corporate Voices for Working Families, in partnership with Abbott Nutrition, Working Mother Media and others, now offers a Web site providing information on creating workplace lactation programs." (Employee Benefit News; free registration required)
[Opinion]
The Road to Economic Recovery: A Proposal to Support Health Care in America (PDF)
13 pages. Excerpt: "The economic recession gripping this nation calls for immediate and swift action. The ripple effects of the financial market crisis, the subsequent rise in unemployment and the loss of job-based health care coverage has impacted hospitals' ability to continue to serve their communities. This pressure, coupled with other payment pressures, is leading to a decline in hospitals' financial health at a time when demand for health care services is growing. Not only could the health of communities across the country be compromised if action is not taken now, but the economic health of those communities also could suffer. As the second-largest private-sector source of jobs - 5 million nationwide - hospitals play a critical part in our nation's economy. Every dollar spent by a hospital supports more than $2.00 of additional business activity in the community. [Originally published January 6, 2009.]" (American Hospital Association)
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| The nation's workforce and health care system are constantly evolving and so are the legal issues. Law Journal Press helps you handle any benefits law question with up-to-date, authoritative books on all aspects of the field. Get legal and practical advice from leading experts on everything from COBRA to ERISA, "contingent" employees to family and medical leave, and more. Browse our product listings for detailed information and special offers. |
Links to Items on Executive Comp, Benefits in General
[Official Guidance]
Text of Correction (Insignificant) to Proposed 409A Regulations Issued Dec. 8, 2008
Changes the phone number of an IRS contact. (Internal Revenue Service)
[Guidance Overview]
Labor Department Guidance on ERISA Bonding Requirements (PDF)
2 pages. Excerpt: "Section 412 of the ERISA generally requires that every fiduciary of an ERISA-covered employee benefit plan, and every person who handles funds or other property of such a plan, must be covered by a bond. The bonding requirement is intended to protect employee benefit plans from risk of loss due to fraud or dishonesty by persons who handle plan funds. The Department of Labor recently issued guidance on ERISA bonding requirements as a means to protect employee benefit plans." (Employee Benefit Plan Review via Winston & Strawn LLP)
[Guidance Overview]
The Stimulus Bill and Other Congressional Action Create New Obligations for Benefit Plan Sponsors
Excerpt: "The President's signing of the American Recovery and Reinvestment Act of 2009 (the 'Stimulus Bill') on February 17, 2009 is just one in a string of recent events which impose new obligations on sponsors of employee benefit plans. This client alert is intended to summarize the employee benefit developments raised by the Stimulus Bill, as well as some other issues now facing employers sponsoring health and retirement plans." (Michael Best & Friedrich LLP)
[Guidance Overview]
Stricter Executive Compensation Limits for TARP Recipients
Excerpt: "On the heels of substantial criticism that the U.S. Treasury's Troubled Asset Relief Program (TARP) did not go far enough to curb excessive compensation being paid to executives of institutions receiving taxpayer assistance, the American Recovery and Reinvestment Act of 2009 (ARRA) imposes stricter restrictions on executive compensation for past and future TARP recipients. ARRA's new executive compensation restrictions most likely will compel TARP recipients to make significant changes to their executive compensation practices." (Ballard Spahr Andrews & Ingersoll, LLP)
[Guidance Overview]
Stimulus Bill's Strict New Executive Compensation Restrictions for TARP Participants
Excerpt: "[The America Reinvestment and Recovery Act of 2009 ('ARRA')] replaces the executive compensation restrictions previously imposed by the Emergency Economic Stabilization Act of 2008 (EESA). In doing so it continues all the same restrictions and adds substantially to the restrictions in several areas. The ARRA also goes substantially beyond the Treasury Department's separate executive compensation guidelines for TARP participants that were announced on February 4. The ARRA restrictions are retroactive, meaning they apply to all TARP participants, whether such companies received money under TARP prior to or after the enactment date, February 17, 2009." (McGuireWoods LLP)
Congress Wraps Up Busy 2007-2008 Term, More Benefit Activity Expected in 2009
Excerpt: "During the 2007-2008 term, Congress enacted important laws affecting health care, retirement, executive compensation, and the Family and Medical Leave Act (FMLA), and considered new issues such as the investment of pension fund assets. Some of the legislation had been debated for years and received a final push from new Democratic majorities in the House and Senate. Other bills and efforts represent attempts to deal with trouble in the broader economy -- such as the financial crisis and rising food and energy costs." (Watson Wyatt Worldwide)
UAW Yields to Market: Wage Reductions, Job Cuts and Loss of Benefits Among Likely Recovery Concessions
Excerpt: "The United Auto Workers, which once set the standard for organized labor for wages and job protection, said yesterday that it is making concessions as part of the recovery plans submitted by General Motors and Chrysler. The plans are expected to accelerate wage reductions, job cuts and loss of benefits, changes already spurred by foreign competition, declining sales and the worst economic conditions since the Great Depression." (The Washington Post; free registration required)
An Initial Look at Workplace Change in the Obama Era (PDF)
26 pages. Excerpt: "The decisive election of Barack Obama as the 44th President of the United States supported by strong Democratic majorities in the House and Senate has set the stage for unprecedented legislative and regulatory change in employment and labor laws. A unique combination of forces promises to make the magnitude of these changes a once-in-a-generation occurrence. The single thread potentially moderating the coming tsunami is the composition of the U.S. Senate. The closer the Democratic majority is to the magic number of 60 (a filibuster-proof Senate majority), the greater is the ability to deliver on a perceived mandate for employment and labor law change. [Originally published November 2008]" (Littler Mendelson, P.C.)
Employee Ownership Update for February 17, 2009
NCEO Executive Director Corey Rosen discusses the predominance of ESOP and other employee-owned companies in Fortune magazine's 100 Best Companies to Work For in America list; Bureau of Labor Statistics data indicating that the percentage of workers receiving stock options in 2008 was unchanged from previous years; and data from Radford Surveys on equity award exchange patterns. (National Center for Employee Ownership)
Executive Pay Caps Might Hurt the Already-Troubled Financial Sector in Attracting and Keeping Key Talent
Excerpt: "The financial stimulus package approved by the House and the Senate last week and signed into law by President Barack Obama on Feb. 17 prohibits cash bonuses and other incentives for the five most-senior officers and the 20 highest-paid executives at companies that receive money under the Treasury's Troubled Asset Relief Program (TARP). While earlier versions of the bill proposed a $500,000 cap on these executives' salaries, the final bill restricts not salaries but bonus pay to no more than one-third of annual salary. Any bonus would have to be in the form of long-term incentives, such as restricted stock, which may not be cashed out until the TARP money is repaid in full." (Human Resource Executive Online)
Newly Posted Events
"Documented Confusion: Understanding Restatement Procedures" Web Seminar
Nationwide on February 26, 2009
presented by SunGard Relius
"Earned Income: Computing Compensation for the Self-employed" Web Seminar
Nationwide on February 24, 2009
presented by SunGard Relius
"Making and Taxing Corrective Distributions After PPA" Web Seminar
Nationwide on March 5, 2009
presented by SunGard Relius
2009 Legal Education Conference
in Oregon on June 24, 2009
presented by National Association of Public Pension Attorneys (NAPPA)
A Case Study: Using Data to Make Good Benefit Plan Decisions Webcast
Nationwide on March 5, 2009
presented by International Foundation of Employee Benefit Plans
COBRA Subsidy Employer Requirements Webinar
Nationwide on February 27, 2009
presented by W.J. Flynn and Associates, LLC
COBRA Subsidy Employer Requirements Webinar
Nationwide on March 2, 2009
presented by W.J. Flynn and Associates, LLC
The New COBRA Premium Assistance Law: What You Need to Do to Comply Now Webcast
Nationwide on February 24, 2009
presented by Employee Benefit Research Institute (EBRI)
Who’s the Employer: Aggregation Aggravation (Presented by S. Derrin Watson, Esq.)
in Colorado on March 10, 2009
presented by Western Pension and Benefits Conference-Denver Chapter
Newly Posted Press Releases
U.S. Department of Labor Sues Former Insurance Agency in Kennesaw, Georgia, to Protect Participants' 401(k) Contributions
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
U.S. Department of Labor Sues Defunct Herndon, Virginia, Company to Protect Participants of 401(k) Profit-sharing Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
U.S. Department of Labor Sues to Appoint Independent Fiduciary for Former Atlanta General Contractor’s 401(k) Profit-sharing Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Commuter Benefits Leader Accor Services USA Applauds Transit Benefit Cap Increase
Accor Services North America
Mercer to Acquire Callan Associates
Mercer
vWise Wins Eddy Award for Harrah's Entertainment 401k Work
vWise Inc.
Innovative and Creative Marketing Analytics and Pension Data Service Launched
Pension Analytix Inc.
Newly Posted or Renewed Job Openings
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Implementation Manager
for OCI
in CO
Actuary - ASA/EA or FSA/EA
for Milliman, Inc.
in ID
Retirement Plan Administrator
for Saltmarsh, Cleaveland & Gund
in FL
Vice President, Benefits Compliance
for 20th Century Fox
in CA
Defined Benefit/Non-Qualified Communications Director
for Prudential Financial
in CT
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
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