Health & Welfare Plans Newsletter |
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| August 5, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy | ||
International Foundation of Employee Benefit Plans (Advert.)
What Rick Wellner, CEBS, says about International Foundation membership: "We became members of the Foundation because of our commitment to the Foundation’s educational content. We leverage our membership in many ways: We use the library for research, the Certificate Series for training, CEBS classes to credential our folks and E-learning courses to get our associates up and running quickly. If there is any kind of article or research in the employee benefits field, we know where to go to get it. You really need to be part of the Foundation if you’re in the employee benefit market." |
[Guidance Overview]
Securing Data Under the New HIPAA Amendments
Excerpt: "Similar to security breach notification laws that have been enacted in more than 40 states, the HIPAA breach notification law requires that if an employer's self-insured health plan experiences a data breach involving individually identifiable health information about plan participants (known as Protected Health Information or PHI), the employer must notify those individuals whose data is involved in the breach. Unlike state laws, which generally apply only to electronic data, the HIPAA breach notification law applies to data in any form, which includes paper documents and even verbal communications. Thus, a duty to notify could arise in the following circumstances: A hacker penetrates your firewall and accesses and possibly acquires a database of health plan participants; An employee goes snooping through health plan records to find information about a co-worker; A manager accesses health plan records to make personnel decisions about employees; An employee e-mails records containing PHI to the wrong e-mail address; An employee discusses a participant's health condition with other employees . . . ." (Warner Norcross & Judd LLP)
[Guidance Overview]
Pennsylvania Adopts Mini-COBRA Requirements for Small Employers with Health Insurance Plans
Excerpt: "[39] states and the District of Columbia have various mini-COBRA rules in their state insurance codes that apply to small businesses (usually those with 2 to 19 employees) that provide medical benefits to their employees. These rules tend to be similar to, although often not exactly like, federal COBRA rules." (Morgan, Lewis & Bockius LLP)
[Guidance Overview]
Retiree Medical Insurance Litigation's Dirty Little Secret: 'Location, Location, Location!'
Excerpt: "While the Sixth Circuit's decision in Yolton v. El Paso Tenn. Pipeline Co., 435 F.3d 571 provides some comfort to employers as to its rejection of the 'inference of vesting,' the uncertainty about Yard-Man's legacy remains. With no lingering 'inference of vesting,' retiree medical disputes should begin again with the language found in each contract. Given the Circuit Courts' different approaches to silence about vesting or ambiguous language about vesting, the outcome of a retiree medical dispute may, in large measure, depend on where it is litigated. To avoid the quicksand of extrinsic evidence, employers must be vigilant about how and where they make retiree medical benefit promises. All statements made about these benefits should be reviewed for clarity and consistency. Populating enrollment forms, summary plan descriptions, plan documents, and collective bargaining agreements with a reservation of the right to amend, modify, or terminate the plan is clearly the best medicine. Plan fiduciaries and plan administrators should be mindful of the importance of the reservation of the right to amend or terminate a plan and perhaps consider using prepared scripts in answering recurring questions about retiree medical benefits. If both administrators and fiduciaries follow these simple guidelines, they may find themselves able to readily change their retiree medical plan benefits rather than wallowing in the hell of 'he said/she said' litigation." (Jones Day)
[Guidance Overview]
Third Circuit Takes Expansive View of Preexisting Condition Exclusion
Excerpt: "Doroshow was an employee of the CVS Corporation and participated in its Long Term Disability Income Insurance Plan, a group benefit plan issued by Hartford. CVS 'delegated sole discretionary authority to Hartford...to determine [the participant's] eligibility for benefits and to interpret the terms and provisions of the plan and any policy issued in connection with it.'" (Roy Harmon III via Health Plan Law)
[Guidance Overview]
Importance of Identification of Funds in ERISA Subro Case
Excerpt: "In Iowa Health Systems v. Graham, 2009 U.S. Dist. LEXIS 63544 (C.D. Ill. July 23, 2009), Iowa Health wants the Court to impose a constructive trust or equitable lien over a portion of specifically identifiable funds over which Graham has possession. This district court opinion provides a useful contrast between Sereboff and Knudson. The benefit plan [paid] medical expenses following an automobile accident involving Duncan Graham. The plan then sought reimbursement for the expenses paid." (Passion for Subro)
Bipartisan Health Care Reform Bill Deadline Set for September 15
Excerpt: "A Senate panel has until September 15 to deliver a bipartisan health care overhaul package before Democratic leaders take steps to push a bill without broad Republican support, a senior member of the Finance Committee said. Sen. Charles Schumer, D-New York and vice chairman of the Democratic Conference, said that the party has 'contingencies in place' that would make it highly likely a bill could pass the Senate without GOP votes, but warned such mechanisms would be used as a 'last resort.'" (Workforce Management; free registration required)
Sick Kids Add to Workplace Anxiety
Excerpt: "A recent study shows that parents of disabled or chronically ill children suffer physical and mental-health problems that increase absenteeism. Experts recommend family-leave and alternative programs as well as more communication about company benefits." (Human Resource Executive Online)
To Reap Short and Long-Term Benefits of Wellness Initiatives, HR Leaders Must Understand That Assessing Readiness for Change Is Key
Excerpt: "If you are considering the implementation of a companywide wellness program, you most likely realize that you are embarking on a journey that requires a significant shift in thinking, attitude and values -- in short, it requires change. From an organizational perspective the need for change is supported by rising healthcare costs that can be controlled and even reduced by implementing an integrated wellness program. From an individual's perspective, the need for change may be obvious or completely obscure, depending on the person's readiness level -- a highly subjective set of needs, desires, knowledge and motivation. Taking time to implement a systematic approach to help set the stage for a major cultural and personal transformation is perhaps the most important and overlooked element in creating effective wellness programs." (Human Resource Executive Online)
Health Plans Ramp Up Efforts, Employ New Technologies, to Detect and Thwart Fraud
Excerpt: "Blues carriers are showing significant improvement in the use of technology to analyze claims. For example, . . . companies are better at putting prepay edits in place to watch out for claims that are impossible (e.g., pregnancy tests for a male) or improbable (e.g., services rendered on a national holiday). Moreover, . . . Blues plans have become savvier at finding aberrant bills through the use of post-pay analyses of claims." (AISHealth.com)
How to Structure a 'Play-or-Pay' Requirement on Employers: Lessons from California on Health Reform
Excerpt: "This policy brief examines the policy design, economic effects, and political ramifications of employer requirements. We focus in particular on what Congress can learn from the California experience, as well as from an independent cost and coverage analysis of the 'Health Care for America' proposal -- a national play-or-pay plan closely resembling current legislative initiatives that was developed by one of us (Hacker) with the support of the Economic Policy Institute. We begin in Part I by reviewing the key reasons for having a play-or-pay requirement. In Part II, we provide a set of recommendations, drawn from the California experience and the 'Health Care for America' plan, for navigating the design and political issues raised by national play-or-pay bills. Finally, Part III examines the economic effects of an employer requirement. We conclude that the potential negative effects are modest, are outweighed by potential benefits, and could be easily addressed in the design of the requirement itself." (Campaign for America's Future)
District Judge Will Decide Future of Deere Retirees' Case
Excerpt: "Attorneys began to lay out their arguments in federal court . . . as part of a class action lawsuit that pits thousands of retirees against their former employer, Deere & Co. During a 4 1/2-hour hearing at the federal courthouse in Davenport, U.S. District Judge Charles Wolle heard arguments from both sides on motions for partial summary judgment on the lawsuit's four counts. His order, which will be issued as a written ruling, will determine which - if any - of the issues will proceed to trial. . . . The lawsuit, filed last fall in U.S. District Court, stems from a new benefits plan that Deere rolled out in 2007. It affected about 5,000 of Deere's flex retirees, who had mostly been salaried employees. The suit was filed on behalf of the Flex Retirees Organization, or FRO, a group that formed after the new benefit plan was introduced. . . . [The plaintiffs] argued that Deere violated ERISA and terms of the plans. [Evidence was offered] that retirees were told for years that they would take 'all their benefits' into retirement and coverage would continue for the remainder of their lives." (The Quad-City Times)
Major Employers Recommend Health Reform Cost Controls
Excerpt: "The HR Policy Association provided President Obama and Congress with a series of recommendations that if enacted as part of health care reform could help control costs and improve the delivery of care. The group said in a letter to policymakers that it supports comprehensive reform but that current bills would 'dramatically increase' costs and place 'new burdens on an already challenged economy.' Its recommendations apply to public and private health care purchasers and focus on cutting costs by reforming provider payment systems to encourage greater efficiency and improved quality." (Mercer LLC)
Employers Hit House Health Reform Provisions As Threat to ERISA
Excerpt: "In a letter to House leaders, more than 150 organizations, including Mercer, criticized 'costly and unacceptable changes to ERISA' posed by provisions in the chamber's developing health care reform package. Proposals to grant ERISA waivers to states that enact single-payer systems, attach state-law remedies to employer-sponsored coverage purchased from insurance exchanges, and bar reductions in retiree health coverage 'would raise costs for both employers and employees,' the groups said. It's not clear if the provisions will be included in a final House bill slated for a September vote." (Mercer LLC)
Medical Tourism Magazine
Medical Tourism Magazine the first and only magazine for the medical tourism, medical travel and health tourism industry. (Medical Tourism Magazine)
[Opinion]
'Sick and Getting Sicker' Does Not Create an Employer of Choice: Response to WSJ Article
Excerpt: "After salary, employees value health care as the number one component of a comprehensive employee benefit program. Based upon the current tax laws, employees are permitted to shift dollars among different components into a section 125 plan and a 401(k) plan. In her July 13th article, 'Sick and Getting Sicker,' Simona Covel of The Wall Street Journal treats health care not as a key component of a total rewards program, but rather as a burdensome expense for employers. She identifies health care costs as a cause of business failure, especially small business failure . . . . The article states, 'It appears that we are at a stage in business where the US will fail due to health care costs.' I would argue that any entrepreneur who cannot overcome the challenge of building a comprehensive total reward program will not be successful. An entrepreneur will have far greater challenges with sharing a vision, building and maintaining an 'employer of choice' culture, establishing authority, making employees part of the solution, and developing great products or services." (Precept Employee Benefits Blog)
BenefitsLink Newsletter (Advert.)
We Have Your Target Audience Have you considered advertising your company's products or services right here in the BenefitsLink newsletter? Our subscribers care about employee benefit plan compliance, administration, costs and design. Roles include in-house benefits directors and administrators, TPAs, consultants, attorneys, trust officers, auditors and investment managers. Your ad will show both your banner and a paragraph of text -- more exposure than you'll find anywhere else. And, of course, a clickable link to any page on your web site. Contact Mary Hall for details. |
Links to Items on Executive Comp, Benefits in General
[Guidance Overview]New FASB Accounting Standards' Ripple Effects on M&A
Excerpt: "The new Statement of Financial Accounting Standards 141R, 'Business Combinations,' and 160, 'Noncontrolling Interests in Consolidated Financial Statements,' might have fallen below the radar screen of many corporate dealmakers so far, but they have significantly changed the way costs for M&A deals must be managed and reported. While driven by the desire to increase transparency of accounting for deal costs, the new rules are also likely to have significant implications for HR's management of staff reduction and other integration issues." (Watson Wyatt Worldwide)
[Guidance Overview]
Red Flags Rules' Compliance Date Delayed Due to Confusion Over Scope of Coverage (PDF)
2 pages. Excerpt: "Entities that are not generally required to comply with FTC rules in other contexts may be subject to the Red Flags Rules. This is because the FTC deems the term 'creditor' to include not just entities that arrange for the extension, renewal or continuation of credit, but also those that regularly permit deferred payments for goods or services. Thus, entities such as investment advisers, financial planners and other professionals that offer or maintain covered accounts and that invoice their customers would be subject to the Red Flags Rules. 'Covered accounts' are defined as accounts used primarily for personal, family or household purposes and designed to permit multiple transactions, as well as accounts for which there is a foreseeable risk of identity theft." (Thompson Hine LLP)
[Guidance Overview]
TARP Issues: Corporate Criminal Pitfalls Associated with Receiving Federal 'Bailout' Funds (PDF)
8 pages. Article starts in the middle of page 1. Excerpt: "This article discusses the various TARP programs Treasury is using to attempt to stabilize the economy and certain enforcement mechanisms that federal law enforcement agencies have at their disposal to combat fraud in the receipt and use of TARP funds. Given the heightened scrutiny of the financial sector and the public outcry over Treasury's distribution and recipients' use of TARP funds, it is likely that we will see vigorous enforcement of fraud related to those 'bailout' funds." (American Bar Association via Morgan, Lewis & Bockius LLP)
[Guidance Overview]
Summary of SEC's Proposed Rules on Enhanced Executive Compensation Disclosure, with Comments (PDF)
Excerpt: "[The] requirement to discuss [the] role of risk in compensation plans will force compensation committees to consider how risk may play a role in incentive compensation, and to consider company-wide compensation plans, both of which have until now generally been considered outside the scope of compensation committees. . . . [They] are a clear example of how the executive compensation proxy disclosure rules have moved beyond disclosure and into shaping compensation policy." (Attorney Charles C. Shulman; reproduced with permission from Pension & Benefits Daily published by the Bureau of National Affairs)
House Approves Executive Pay Bill
Excerpt: "The House . . . passed legislation (HR 3269) that would require an annual nonbinding shareholder 'say-on-pay' vote and independent compensation committees for public companies, including a ban on compensation committees' hiring of non-independent advisers based on rules to be developed by the SEC. The bill would also prohibit payment by financial institutions of incentives that encourage 'inappropriate risk' and expand their disclosure of incentive pay plans. The measure faces an uncertain future in the Senate, although separate say-on-pay legislation could gain traction there in the fall." (Mercer LLC)
Flexible Hours for Nonexempt Workers May Be Next on Lobbyists' Agenda
Excerpt: "Flexible work arrangements traditionally have been the domain of exempt, salaried employees, but now more companies are using them for nonexempt, hourly workers, experts say." (Workforce Management; free registration required)
FTC Clarification of Status of 401(k) Accounts and Health FSAs Under Red Flag Identity Theft Rule
Excerpt: "Pension and benefit plan sponsors and service providers have questioned whether offering or administering 401(k) plan loans or health care flexible spending accounts makes them 'creditors' or 'financial institutions' subject to the Red Flag Rule. The FTC, in a series of frequently-asked questions [at http://www.ftc.gov/bcp/edu/microsites/redflagsrule/faqs.shtm], has clarified these issues; see Section B Questions 12, 13 and 14. To give creditors and financial institutions more time to review this guidance and develop and implement written Identity Theft Prevention Programs, the FTC has announced that it will delay enforcement of the rule from August 1, 2009 until November 1, 2009." (International Foundation of Employee Benefit Plans)
Special Report on Employee Relocation
Excerpt: "The situation Consolidated Container faces and the actions it is taking mirror what's happening throughout the country as businesses large and small come to grips with the financial effects of the real estate bust and recession. Nationwide, fewer employees are willing to move for a job. Of 179 companies in a 2009 survey by relocation outsourcer Cartus, 79 percent said employees' resistance to moving increased somewhat or a great deal over the past year. For 94 percent of those, worries over selling an existing home were the main reason." (Workforce Management; free registration required)
Employee Ownership Update for August 4, 2009
NCEO Executive Director Corey Rosen discusses ESOP valuations in the downturn; how 11 of the 35 Winning Workplaces Awards finalists are NCEO members; statements in a new papal encyclical that could relate to employee ownership; whether it is taxable if employees monetize stock options with call options; and a new ESPP survey showing few changes to plans. (National Center for Employee Ownership)
Webcasts and Conferences
Compliance Assistance and Information Workshopin Nevada on August 25, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Compliance Assistance and Information Workshop
in Nevada on August 26, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
(Click to post your webcast or conference)
Press Releases
ERIC Expresses Support for Chairman Frank's Statement that Proposed CFPA Would Have No Regulatory Authority over Retirement PlansERIC (ERISA Industry Committee)
NCQA's Quality Compass 2009 Details Performance Data for 415 Commercial Health Plans Serving Over 94 Million Americans
National Committee for Quality Assurance (NCQA)
(Click to post your press release)
Employee Benefits Jobs
Technical Compliance Manager/ERISA Attorneyfor Pension Specialists, Inc.
in CA
Regional Consulting Manager
for BPAS
in TX
(Click to post your job opening | View all jobs |
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EmployeeBenefitsJobs.com (Sponsor)
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