Health & Welfare Plans Newsletter |
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| June 12, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy | ||
University Conference Services (Advert.)
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[Guidance Overview]
Minnesota Enacts Relief on Employer Reporting Requirement and Minnesota Department of Commerce Releases Opt-Out Form
Excerpt: "Minnesota has amended the law imposing a reporting requirement on employers with respect to pre-tax premium payments. In addition, the Minnesota Department of Commerce has released an opt-out form for the cafeteria plan law enacted last year. Below is an update regarding both developments." (Dorsey & Whitney LLP)
Estimate by Joint Committee on Taxation of Revenue Effect of Proposed Cap on Income Tax Exclusion for Employer-Provided Health Insurance (PDF)
6 pages; letter of June 2 to Senators Baucus and Grassley. (Joint Committee on Taxation)
Capping the Health Insurance Tax Exclusion: Consequences Vary Greatly Across States and Regions (PDF)
10 pages. Excerpt: "What has yet to be examined is how cross-state variations in health costs change the likelihood of being directly affected by a tax cap. While some research has looked at regional variation in health insurance premiums and health care costs, even less research has examined regional variation in the share of the enrollee population likely to be affected by a cap in the employer exclusion (though Dorn (2009) has come the closest). This Issue Brief attempts to fill that gap." (Economic Policy Institute)
Prevention Efforts Provide No Panacea on Health Costs
Excerpt: "There is one idea for fixing the health-care system that lawmakers in both parties agree on: a bigger government role in disease prevention. Yet many previous government prevention efforts aimed at costly chronic diseases have had little success in reducing illness or costs. 'It is not going to cut costs,' said Louise Russell, a research professor in the Institute for Health at Rutgers University who has studied the issue. 'We already do a lot more prevention than other countries. We are not healthier.'" (The Wall Street Journal)
Why Does U.S. Healthcare Reform Founder?
Excerpt: "A recent study by the McKinsey Global Institute found that the US spends $650 billion more on healthcare than might be expected given its wealth and the experience of comparable well-to-do nations. Roughly two-thirds of that excess pays for outpatient care, including visits to physicians, same-day hospital treatment, and emergency-room care, often expensive tasks relying primarily on paid individuals and not medical machines. The lead author of that study, Diana Farrell, has gone to the White House to work for Lawrence Summers, head of the National Economic Council. Of course, many reformers hope to squeeze costly inefficiencies out of the US healthcare system. For instance, a new study published in Health Affairs, an academic journal, finds the time cost to physicians of dealing with health plans runs $23 billion to $31 billion each year. Reformers also point to the use of costly medical procedures when less expensive ones work as well or better." (The Christian Science Monitor)
The Economic Impact of Healthcare Reform on Small Business (PDF)
24 pages. Excerpt: "Against [the] backdrop of a failing system and the prospect of true reform, Small Business Majority commissioned noted economist and Massachusetts Institute of Technology professor Jonathan Gruber to apply his trusted healthcare economics microsimulation model to the small business sector -- specifically those businesses with 100 or fewer employees. Using his model, Dr. Gruber analyzed the continued impact of no reform on small business costs, jobs, wages and profits over the next ten years and contrasted that with three different reform scenarios, all based on the shared responsibility model proposed by President Obama and now being debated on Capitol Hill." (Small Business Majority)
Interest Groups Rebel at the Idea That New Healthcare Coverage Costs Will Fall on Them
Excerpt: "[T]he prospect of new taxes, new fees for businesses and cutbacks in other government spending has set off a furious behind-the-scenes struggle that is reviving the old maxim attributed to the late Sen. Russell Long of Louisiana: 'Don't tax you, don't tax me, tax that fellow behind the tree.' Faced with a proposal to increase the tax on liquor and soft drinks, for instance, the liquor lobby sent Anchor Brewing Co. of San Francisco to see House Speaker Nancy Pelosi (D-San Francisco). The milk industry objected too, saying it would have to raise the price of chocolate milk. And when congressional Democrats started warming up to the idea of curbing the tax break for employer-provided health benefits, the labor movement attacked one of the idea's leading champions, liberal Sen. Ron Wyden (D-Ore.)." (Los Angeles Times)
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Links to Items on Executive Comp, Benefits in General
[Official Guidance]Treasury Department Fact Sheet on Compensation Committee Independence (PDF)
Excerpt: "We will propose legislation that will give compensation committees greater independence, just as Sarbanes-Oxley did for audit committees. The legislation will direct the SEC to promulgate rules requiring companies listed on national securities exchanges to meet exacting standards for independence. Under these rules, not only would compensation committee members be truly independent from management, but the committee's compensation consultants and legal counsel would be answerable only to the committee." (U.S. Department of the Treasury via American Benefits Council)
[Official Guidance]
Treasury Department Fact Sheet on Say-on-Pay Measures (PDF)
Excerpt: From the 4th item on the factsheet: 'Shareholders will have the right to cast a non-binding vote on golden parachutes: Consistent with the say-on-pay legislation President Obama co-sponsored while in the Senate, shareholders will have the opportunity to cast a non-binding vote to approve or disapprove golden parachute compensation disclosed in proxy solicitation materials prepared for shareholder meetings relating to a merger, acquisition, or other transaction that may involve a change in control of the corporation." (U.S. Department of the Treasury via American Benefits Council)
[Guidance Overview]
More on the Obama Administration's Proposal to Reform Executive Compensation
Excerpt: "As promised yesterday, this Blog will include more detail on the Obama Administration's five point program for reforming the executive compensation. Note, this proposal is intended to apply beyond the financial services industry." (Michael Melbinger via Winston & Strawn LLP)
[Guidance Overview]
IRS Addresses Certain Nonqualified Deferred Comp Payments in Stock Transactions with Financial Entities
Excerpt: "In Notice 2009-49, the IRS explains that it anticipates that most of the financial institutions involved in TARP equity acquisition transactions are, and will be, sponsors of nonqualified deferred compensation plans subject to Sec. 409A. The agency then states, 'The Treasury Department and IRS have determined that a Treasury EESA equity acquisition transaction is not a change in control event under section 409A and the final regulations. Treating a Treasury EESA equity acquisition transaction as a change in control event and, therefore, a permissible payment event, would be inconsistent with the purposes of EESA and section 409A, and would be contrary to the public interest." (Wolters Kluwer)
Executives Unruffled by Administration's Proposed Compensation Rules
Excerpt: "While the White House's new so-called special master for compensation, prominent Washington lawyer Kenneth R. Feinberg, has been given unprecedented powers to set pay at seven of the most troubled firms, the plan that was laid out Wednesday largely maintains the status quo for compensation practices at all other publicly traded companies, including hundreds that are receiving taxpayer assistance. In addition, the administration got rid of a previously announced $500,000 salary cap at financial firms that in the future take the kind of exceptional assistance that firms such as Citigroup and Bank of America have received." (The Washington Post; free registration required)
Opening Statement to House Committee by Treasury Counselor Gene Sperling Addressing Federal Executive Compensation Controls
Excerpt: "Our goal is to help ensure that there is a much closer alignment between compensation, sound risk management and long-term value creation for firms and the economy as a whole. Our goal is not to have the government micromanage private sector compensation. . . . We also recognize these principles may evolve over time, and we look forward to engaging in a discussion with this Committee, the Congress, supervisors, academics and other compensation experts, shareholders and the business community about the best path." (U.S. Department of the Treasury)
IRS Proposes Safe Harbor Rule for Taxing Work Cell Phone Use
Excerpt: "The Internal Revenue Service (IRS) is considering a new rule to tax a quarter of employees' use of employer-provided cell phones as a fringe benefit, Dow Jones reported. The Dow Jones news report said the IRS is considering simplifying existing recordkeeping requirements about employee cell phone use. The IRS proposal would be for a safe harbor rule deeming 75% of work cell phone usage to be for work and 25% to be personal and taxable as a fringe benefit, Dow Jones explained." (PLANSPONSOR.com; free registration required)
Webcasts and Conferences
403(b) Plan Workshop: Implementing Recent Guidance for Tax Exempt and Government EmployersNationwide on July 7, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
Retirement, Deferred Compensation, and Welfare Plans of Tax-Exempt and Government Employers
in District of Columbia on September 10, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
Voluntary Fiduciary Correction Program Workshop
in California on July 8, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
(Click to post your webcast or conference)
Press Releases
Actuaries Weigh in on Ways to Address Risk Exposures and Challenges with the U.S. Health Care SystemSociety of Actuaries
PBGC Assumes Amsterdam Memorial Hospital Pension Plan
Pension Benefit Guaranty Corporation (PBGC)
PBGC Seeks Recovery on Behalf of Tom's Foods Inc. Pension Plan
Pension Benefit Guaranty Corporation (PBGC)
U.S. Labor Department Recovers More Than $9 Million for Retirement Plans of Bankrupt Aloha Airlines
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Great-West to Sponsor 403(b) Prototype Plan
Great-West Retirement Services
SHRM Calls for Flexible, Voluntary Federal Policy on Paid Leave
Society for Human Resource Management (SHRM)
White Horse Advisors Adds Republic National Distributing Company to Its Client Roster
White Horse Advisors, LLC
Austen Riggs Center Selects MassMutual for 403(b) Plan
MassMutual
NAPFA Salutes Congressional Leaders In Efforts To Protect 401(k) Participants
National Association of Personal Financial Advisors (NAPFA)
Mercer Announces Expanded Health and Benefits Administration Outsourcing Solution
Mercer
(Click to post your press release)
Employee Benefits Jobs
Sr. Benefits Specialistfor Kohler Co
in WI
Client Services Associate
for Milliman
in TX
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Handy Links:
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