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Health & Welfare Plans Newsletter

May 10, 2010

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This May 13 webcast – which will appeal to sponsors of all types of public sector group health plans, whether local in scope or part of a state-wide system – will highlight the short- and long-term changes that will impact public sector health plans for active employees and retirees. The likely impact of health plan costs and the best strategies to meet the challenges facing public sector health plan sponsors will be discussed.

[Guidance Overview]
Five Changes Under Health Care Reform to Consider Now (PDF)
Pages 1-3 of 10 pages. Excerpt: "Grandfathered Plan Status[:] Make no changes to the plan, unless required to do so by law. Otherwise, the plan may be subject to all of the provisions of the Act, rather than the more limited set that is applicable only to grandfathered plans."
(Trucker Huss)

[Guidance Overview]
The Early Retiree Reinsurance Program under Health Care Reform
Excerpt: "Recent guidance issued by the Department of Health and Human Services specifies the qualifications for eligibility, the steps plan sponsors must take in the application process and the requirements for reimbursement."
(McDermott Will & Emery)

[Guidance Overview]
Federal Health Care Reform: Mandated Coverage for Preventive Services Without Cost-Sharing (PDF)
3 pages. Excerpt: "The Preventive Services Mandate is intended to eliminate financial barriers to accessibility, enabling individuals to identify health issues early and take appropriate measures to stay healthy or treat problems in the earliest stages. Carriers and plan administrators should be prepared to take quick action to ensure compliance with these new legal requirements by September 23, 2010."
(Locke Lord Bissell & Liddell LLP)

[Guidance Overview]
Retiree Reinsurance Program Interim Final Regulation
Excerpt: "An eligible employment-based plan is a group health plan that provides benefits to Early Retirees (but can cover active employees as well) that is certified by HHS, and provides documentation of the actual cost of medical claims involved."
(Groom Law Group)

Insurer Seeks a Little Less Parity for Mental Health Coverage
Excerpt: "Specifically, [UnitedHealth Group] warned that if it cannot offer separate deductibles; for example, $250 each for mental health and other care, employers will combine them into a single, $500 deductible for everyone."
(National Public Radio)

Audio and Text: Obama Budget Pushes Paid Leave Programs
Excerpt: "The Obama administration's budget includes $50 million to help states with start-up costs for family leave programs -- not for costs associated with the leave days. It would pay for things like computers and administration, which Washington state estimates would cost $10 million the first year."
(Morning Edition via National Public Radio)

10 Tips for Helping Employees with Aging Parents
Excerpt: "Employees who are caregivers for aging parents need all the help they can get. Here are some steps employers can take to assist them -- and keep up productivity at the same time."
(Workforce Management; free registration required)

The Small Employer Tax Credit under Health Care Reform (PDF)
Excerpt: "To qualify for the tax credit, a small employer must pay a uniform percentage for each coverage level that is at least 50 percent of the premium cost towards employees' coverage. For 2010, the IRS has provided transition relief regarding this requirement. For that year only, an employer is treated as satisfying the 50 percent requirement even if it contributes varying amounts towards coverage . . . ."
(Kushner & Company)

When and How to Communicate with Employees About Health Law's Impact on Group Health Plan Coverage
Excerpt: "The extent of this communication may vary, certainly. At the most basic level, companies can consider a message to all employees that assures them that management is currently working with health and benefits experts to assess the potential implications of the new legislation on benefits offerings . . . ."
(Human Resource Executive Online)

Employer Groups Ask for Good Faith Relief as They Await Agency Regulations on Health Reform
Excerpt: "[B]ecause employers are attempting to make coverage and policy decisions either in the absence of final regulations or with little time between the issuance of rules and the effective date of the new law, HR Policy joined . . . other organizations in writing to HHS, DOL, and Treasury to request relief . . . . Specifically, the letter requests that employers be given a reasonable transition period to comply with the law . . . ."
(HR Policy Association)

EBSA FAQs: Extension of Health Insurance Coverage for Adult Children
Excerpt: "The Affordable Care Act requires plans and issuers that offer dependent coverage to make the coverage available until the adult child reaches the age of 26. Many parents and their children who worried about losing health insurance after they graduated from college no longer have to worry."
(U.S. Employee Benefits Security Administration)

HHS Initial Guidance on Health Reform Web Portal
Excerpt: "At a minimum, the Web portal will provide information on the following: 1. Health insurance coverage offered by health insurance issuers; 2. Medicaid coverage; 3. Children's Health Insurance Program (CHIP) coverage; 4. State health benefits high risk pool coverage; 5. Coverage under the high risk pool created by Sec. 1101 of the Affordable Care Act; and 6. Coverage within the small group market for small businesses and their employees."
(Wolters Kluwer)

Following Trend of All Health Spending, Cancer Costs Double
Excerpt: "In 1987, the total cost of cancer treatment in the United States was $24.7 billion (in 2007 dollars), compared with $48.1 billion a year during 2001-2005. The cost of cancer treatments as a percentage of overall medical treatment has stayed steady at about 5% over the past 20 years."

Fight Erupts Over Rules Issued for 'Mental Health Parity' Insurance Law
Excerpt: "[I]nsurers say the Obama administration went overboard when it tried to regulate 'nonquantitative treatment limits.' These include the techniques used by insurers to manage care, the criteria for selection of health care providers and the rates at which they are paid."
(The New York Times; free registration required)

Health Law's 'Grandfather' Clause Could Deprive Consumers of Key Benefits
Excerpt: "Congress included the grandfather provisions in the bill to give employers and insurers time to transition to the new law. But the law is mostly vague on exactly what constitutes a grandfathered plan. For example, does a plan lose its grandfather status if it increases employees' deductibles or changes prescription drug coverage? Plans that give up their grandfather status must abide by all the consumer protections in the new law."
(Henry J. Kaiser Family Foundation)

Companies Get Help to Insure Early Retirees
Excerpt: "The new program, sometimes called reinsurance, should help retirees 55 to 64. It ends on 2014, when other provisions to make it easier for people to find affordable coverage take effect."
(Henry J. Kaiser Family Foundation)

Health Groups Vie for $15 Billion in Prevention Money
Excerpt: "Some groups want the bulk of the money earmarked for programs to target specific diseases or problems that affect millions of Americans, such as obesity, diabetes or smoking. But public health officials say the majority of funds should not go solely into fighting specific diseases but be used to bolster agencies whose work targets a broad range of the causes of death and disability. Others advocate using the fund to transform communities to make it easier to exercise and buy fresh produce."
(National Public Radio)

Health Care Reform: A Timeline for Employers to Follow
Excerpt: "The legislation will impose significant new responsibilities on employers, some of which are already effective. While further guidance is expected on the application of these requirements, the following provides a summary and timeline of key provisions of the PPACA."
(Littler Mendelson P.C.)

Health Care Reform Introduces Array of Cost Containment Measures
Excerpt: "[There are two particular] provisions that focus on containing health care costs: (1) the further 'administrative simplification' of transactions between health plans, providers and patients; and (2) the creation of an Independent Payment Advisory Board to make annual proposals to constrain the growth rate of Medicare costs and to make recommendations to the private sector."
(Hinshaw & Culbertson LLP)

Rescissions After The PPACA -- A Preview
Excerpt: "Under the PPACA, rescission is prohibited except in cases of fraud or misrepresentation. . . . The health insurance industry agreed to comply with this requirement ahead of the September effective date."
(Roy Harmon via Health Plan Law)

The Four Worst Features of the Health Care Reform Legislation
Excerpt: "The Bizarre Subsidies. Look at it from the employee's point of view. The new law says that an employee must have insurance costing, say, $15,000 for family coverage in 2016. Remembering that employee benefits are a dollar-for-dollar substitute for wages, that implies that a previously uninsured $30,000-a-year worker will get a 50% cut in pay."
(National Healthcare Reform Magazine via National Center for Policy Analysis)

Register now for the 2010 SPARK National Conference, June 13-15 at the Mandarin Oriental Hotel in Washington, DC. Join the top marketing, sales, administration and record keeping professionals at the retirement services industry’s leading educational and networking event. Gain insights into the latest business, marketing and sales strategies. Get updates on current market trends, regulatory and legislative issues. Attend sessions designed for TPAs, Financial Advisors and RIAs. Network with peers and earn Continuing Education Credits.

Executive Compensation; Benefits in General

What, If Anything, Do Companies Need to Worry About in Terms of Potential Government Legislation or Regulation of Executive Compensation?
Excerpt: "No one can be certain of whether the full Congress will pass any of [the current] bills into law, or what the final wording of the bills will be. However, nearly all of the bills have a few common provisions that could become law in 2010 or 2011. These common provisions are discussed [in the target item]."
(Michael Melbinger via Winston & Strawn LLP)

Webcasts and Conferences

How Employers Can Adapt to Health Care Law Changes Webcast
Nationwide on May 13, 2010
presented by West LegalEdcenter

Leadership for Productivity and Health Management: Issues, Innovations, and Solutions
in Massachusetts on September 30, 2010
presented by Harvard School of Public Health Center for Continuing Professional Education

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