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Health & Welfare Plans Newsletter

April 29, 2010

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Learn what single employers need to do now—both tactically and strategically. The May 6 webcast will provide timelines for employers, so they understand what to do now, next year and beyond. Explore the long-term strategies that will emerge as a result of this law’s passage. Topics include why employers provide coverage to associates and their families, competitive positioning of these benefits and cost containment actions to consider over the next few years.

[Guidance Overview]
Health Reform Act Requires Coverage of Adult Children But with Important 'Grandfather Plan' Exception
Excerpt: "Grandfathered plans [(plans that were in existence on March 23, 2010)] must also provide adult children with coverage for plan years beginning on or after September 23, 2010, but only if the adult child is not eligible to enroll in another employer-sponsored plan. In 2014, grandfathered plans must offer coverage to otherwise eligible adult children even if they are eligible to participate in another employer-provided plan."
(Thorp Reed & Armstrong)

[Guidance Overview]
Health Benefit Tax Exclusion for Adult Children -- Just When You Thought You Got Rid of the Kid
Excerpt: "Under the Act, group health plans and insurers that offer coverage covering dependent children must make that coverage available to adult children until they reach age 26. . . . The Act [also extends] the general exclusion from gross income for employer-provided medical care to any employee's child who has not attained age 27 as of the end of the employee's taxable year . . . ."
(McGuireWoods LLP)

[Guidance Overview]
IRS Clarifies Rules Regarding Adult Dependents
Excerpt: "[I]f an adult child turns 27 in any month of 2010, a Health FSA/HRA cannot reimburse any 2010 expenses for that adult child. However, expenses for adult children who are 26 or younger as of the end of the calendar year may be reimbursed if incurred on or after March 30, 2010. . . . [P]articipants who add an adult child dependent can increase their current year Health FSA election."

[Guidance Overview]
Understanding COBRA And Mini-COBRA Premium Assistance
Excerpt: "The Recovery Act also provides premium assistance to involuntarily unemployed workers who receive continued coverage under state programs, but only for those programs that are 'comparable' to COBRA."
(Families USA)

[Guidance Overview]
Health Care Reform Reshapes Tax Code; Several Employee Benefit Provisions Affected
Excerpt: "[A]mounts paid for over-the-counter medications will no longer be reimbursable from health savings accounts (HSAs), Archer medical savings accounts (MSAs), health FSAs, or health reimbursement arrangements. . . This provision is effective for amounts paid or expenses incurred after Dec. 31, 2010."
(Journal of Accountancy)

IRS Lacks Clout to Enforce Mandatory Health Insurance
Excerpt: "Starting in 2014, the agency will have [a massive] task: making sure all Americans have health insurance. Under the law, Americans who can afford health insurance but refuse to buy it will face a fine of up to $695 or 2.5% of their income, whichever is higher."

Billions in Community Health Funding Are Employer Savings Opportunity
Excerpt: "Eight billion dollars in health care reform funding in fiscal years 2011 through 2015 for community health centers (CHCs) soon could provide a lower-cost medical care option for employers. CHCs traditionally are the primary care provider of last resort for the nation's indigent, immigrant and uninsured. But those aren't the only populations they serve."
(Thompson Publishing Group)

Insurers Move To Cover Older Children Ahead of September 23 Required Start Date
Excerpt: "At least four insurers have agreed to extend insured group coverage to some older children before a health reform provision that extends coverage to most children who are younger than age 26 and that takes effect beginning in September."
(Wolters Kluwer Law & Business)

Constitution Puts Mandatory Health Insurance in Peril, Constitutional Law Prof Says
Excerpt: "It is true that the Supreme Court has interpreted the Commerce Clause broadly enough to reach wholly intrastate economic 'activity' that substantially affects interstate commerce. But the Court has never upheld a requirement that individuals who are doing nothing must engage in economic activity by entering into a contractual relationship with a private company. Such a claim of power is literally unprecedented."
(Wall Street Journal)

Groups Tell OMB Not to Approve DOL Reg Defining 'Welfare Benefit Plan' (PDF)
5 pages. Excerpt: "We request that this proposed regulation be withdrawn in order to assess its compatibility with the intent of the recently enacted comprehensive health care reform. . . . As we understand it, the proposed redefinition of a 'welfare benefit plan' could obligate employers, whose plans are currently governed by nationally uniform rules under ERISA, to comply with myriad state or local rules. If"
(American Benefits Council, Other Organizations)

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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.

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Executive Compensation; Benefits in General

Chart of DOL's 2010 Regulatory Agenda for Employee Benefit Matters (PDF)
3 pages. Excerpt: "DOL's agenda and related materials include 20 pending projects related to employee benefits, which are listed below in order of the projected timetable for next steps. (In the ordinary course, dates projected in the agenda may prove ambitious.) New projects highlighted by DOL are shown in bold."

Out of Balance? Comparing Public and Private Sector Compensation Over 20 Years
Includes link to the study, a fact sheet and a Powerpoint presentation.
(Center for State & Local Government Excellence)

Career Advice for the New(er) ERISA Lawyer
Excerpt: "Here are some tips: . . . Stay Current . . . Network . . . Master a Hot Topic . . . Never publish anything only once . . . Invite yourself to the party . . . Get a Life."
(BNA Pension and Benefits Blog)

Comments on Proposed Amendment to Bank Secrecy Act Regulations -- Foreign Account Reporting ('FBAR') (PDF)
April 27, 2010; 12 pages. Excerpt: "[T]he policy goals of the foreign account provisions of the Bank Secrecy Act -- to detect and prevent taxpayers from hiding assets offshore to avoid income taxes or launder money -- are not advanced by requiring U.S persons to file FBAR with respect to 'foreign financial accounts' held by or for the benefit of employee benefit pension plans, voluntary employee beneficiary associations ('VEBAs'), and individual retirement accounts . . . ."
(Groom Law Group)

Webcasts and Conferences

2010 NCCMP Annual Conference
in Florida on September 25, 2010
presented by National Coordinating Committee for Multiemployer Plans

Communicating Employee Benefits Workshops
in Illinois on June 24, 2010
presented by The Conference Board

Executive Compensation Conference
in New York on May 5, 2010
presented by The Conference Board

Executive Compensation Conference
in New York on June 9, 2010
presented by The Conference Board

Health Care Reform Requirements Impacting Multiemployer Plans
Nationwide on May 20, 2010
presented by International Foundation of Employee Benefit Plans

Health Care Reform: What Public Sector Plan Sponsors Need to Know Now
Nationwide on May 13, 2010
presented by International Foundation of Employee Benefit Plans

Health Care Seminars
in New York on September 28, 2010
presented by The Conference Board

Retirement Roundtable
in New York on June 15, 2010
presented by The Conference Board

Press Releases

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