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Health & Welfare Plans Newsletter

February 12, 2010

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The Department of Defense Appropriations Act for 2010 extends the COBRA premium subsidies that were enacted last year in the American Recovery and Reinvestment Act. The new law is retroactive (as if included in the ARRA) and will require immediate attention from plan sponsors and their COBRA administrators. The International Foundation’s e-learning course will focus on what plan sponsors need to do to administer those requirements.

[Guidance Overview]
Interim Final Mental Health Parity Regulations As Issued by DOL, DHHS, and Treasury Departments
Excerpt: "Recently, the DOL, DHHS, and Treasury departments jointly issued interim final regulations on the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). In this article, we review key provisions of the MHPAEA interim final regulations and their implications for employers."
(J.P. Morgan Compensation and Benefit Strategies)

[Guidance Overview]
Employers Should Review Current Plan Design to Confirm That Separate Deductable Not Required When Implementing Mental Health Parity and Addiction Equity Act (PDF)
5 pages. Excerpt: "The regulations confirm that small employers are exempt from MHPAEA's requirements and define a small employer as an employer who employed an average of not more than 50 employees on business days during the preceding calendar year. In addition, MHPAEA includes an increased cost exemption. MHPAEA changed the MHPA increased cost exemption in several ways, including (1) raising the threshold for qualification from 1 percent to 2 percent for the first year for which the Plan is subject to MHPAEA; (2) requiring certification by qualified and licensed actuaries; and (3) revising the notice requirements."
(Drinker Biddle & Reath LLP)

[Guidance Overview]
Employers Sponsoring Health Insurance for Workers Must Provide CHIPRA Notice
Excerpt: "Employers who offer group health plan coverage must provide this notice to employees before the beginning of the next plan year, and annually thereafter."
(Bond, Schoeneck & King, PLLC)

Small Businesses Sick of Health Care Debate
Excerpt: "'When you talk to small business people about what their struggles are, obviously the economy and getting credit are really high on the list,' said Todd McCracken, NSBA president. 'As the (healthcare) debate went on, they saw that less and less of what was happening was going to drive down healthcare costs, which was their overriding concern.'"
(International Business Times)

IRS Finds Few Takers for Health Care Tax Credits
Excerpt: "Federal healthcare benefits are going unclaimed by an estimated 17,000 Californians whose jobs were moved overseas or retirees whose pensions are being paid by the government after their former employers terminated their retirement plans. So far, less than a third of those in the state who could be eligible are getting the money that can pay as much as 80% of their healthcare costs, and the federal government has begun a major push to find people who are eligible."
(Los Angeles Times)

Sen. Reid to Take COBRA Extension Out of Pared-Down Jobs Bill
Excerpt: "Among the provisions that Reid delayed, and that are now expected to move as a separate bill, is [a provision under which] COBRA health benefits would be extended by three months . . . ."
(The Washington Post; free registration required)

Loopholes Remain in Mental Health Coverage
Excerpt: "Those who provide and need mental health services now have some parity in the new year, yet loopholes remain in the coverage. . . . First, realize it is about parity and not about having coverage. 'Employers decide if they want this or don't want it; they don't have to provide mental health coverage,' Sergi said. 'If an employer opts in with health care benefits that include mental health, then they must provide parity.'"
(The Reporter)

Employee Wellbeing: Taking Engagement and Performance to the Next Level (PDF)
Excerpt: "What do we mean by wellbeing? Towers Watson defines it as encompassing three interconnected aspects of an individual's 'work life':Physical health - overall health, energy/stamina; Psychological health - stress/anxiety, intrinsic satisfaction, accomplishment, optimism, confidence, control, empower-ment, safety; Social 'health' - work relationships, balance in work and personal life, equity, fairness, respect, social connectedness."
(Towers Watson)

Health Care Fraud Costs U.S. More Than $60 Billion Annually, According to Justice Department
Excerpt: "Health care fraud remains a significant problem, estimated to cost the public and private sectors more than $60 billion each year . . . ."
(Wolters Kluwer)

Medical Sharing: An Inexpensive Alternative to Health Insurance (PDF)
Excerpt: "Medical sharing groups are private non-profit Christian organizations designed to help members pay for their health care expenses. They are also called health care sharing ministries, as written in the Senate health insurance reform bill, H.R. 3590. There are no laws forbiding other groups or faiths from medical sharing, but we found only Christian groups. There are three medical sharing ministries in the United States: Medi-Share (Christian Care Ministry is the parent company), Christian Healthcare Ministries, and Samaritan Ministries International."
(Citizens Council on Health Care)

Coburn-Ryan Health Bill Would Significantly Erode Employer-Based Coverage
Excerpt: "The bill (S. 1099 and H.R. 2520) would eliminate the main federal tax subsidy for employer-sponsored insurance -- the income-tax exclusion for employer-sponsored insurance -- and replace it with a refundable tax credit ($2,290 for individuals and $5,710 for families) that people could use to purchase coverage. Many employers would almost certainly drop coverage as a result . . . ."
(Center on Budget and Policy Priorities)

Closing the Health Care Loopholes
Excerpt: "[With the closing of a minor loophole, real progress could be achieved] on many of the issues which Republicans and Democrats share common ground on. So what's this simple loophole? It's called, 'ERISA preemption.' Basically, ERISA is a federal law that was designed to regulate all employee benefits. Where there is a federal law that governs certain activities -- in this case the administration of employee benefits -- then any state law governing the same activity is 'pre-empted' or superseded by the federal ERISA law. ERISA was never intended to regulate health insurance, and even contains explicit language which states that it is not to be read to cover healthcare plans."
(The Cornell Daily Sun)

The Defined Contribution Plans Summit taking place February 24-25, 2010 in New York, NY is the perfect platform for corporate and public DC plans to hear from their plan sponsor peers, leading policymakers and top investment executives. Attendees will share ideas through tailored interactive roundtables, benchmark their DC plans through case studies, and network with fellow plan sponsors and investment professionals. For more information please visit –

Executive Compensation; Benefits in General

[Guidance Overview]
IRS Rules that Employer-Provided Clothing Is Not Wages Under Some Circumstances
Excerpt: "In Private Letter Ruling 2010-05014, the Internal Revenue Service (IRS) held that an employer could exclude the value of employer-provided clothing and related accessories from its employees' wages as a de minimis fringe benefit."
(Littler Mendelson P.C.)

Lawmaker Says Federal Teleworkers Should be Rewarded During Closings
Excerpt: "U.S. Representative Gerry Connolly (D-Virginia) wants the Office of Personnel Management to consider incentives for employees who work remotely while the government is shutdown."

Webcasts and Conferences

"EFAST2: A New Decade in Plan Reporting" Archived Web Seminar
Nationwide on February 11, 2010
presented by SunGard Relius

401(k) Plan Basic Operation
in California on May 4, 2010
presented by Actuarial Consultants, Inc.

Annual Plan Administration Basic Training
in California on May 4, 2010
presented by Actuarial Consultants, Inc.

Important and Expanded Retirement Planning Techniques (Including Unlimited ROTH IRAs and Non Spouse Beneficiary Rollovers)
in New York on February 18, 2010
presented by WEB (Worldwide Employee Benefits Network ), New York Chapter

Which Way Is Up? An Economic Update
in New York on February 23, 2010
presented by International Society of Certified Employee Benefit Specialists - NY Metro Chapter

Press Releases

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