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Health & Welfare Plans Newsletter

May 20, 2010

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[Guidance Overview]
The Early Retiree Reinsurance Program: 'First Come-First Served!'
Excerpt: "Once applications become available, post-retirement health plan sponsors will need to scramble to submit them to the Department of Health and Human Services ('HHS') if they want to participate in the temporary early retiree reinsurance program. Funds for the program are limited and applications will be processed in the order received subject to a cut-off when funds run out."
(Warner Norcross & Judd LLP)

[Guidance Overview]
Ninth Circuit Upholds Ban of Discretionary Clauses
Excerpt: "For fully insured plans, this is another indication that state regulations banning discretionary clauses will survive ERISA preemption challenge. Bear in mind that these regulations, in states adopting them (often based upon the NAIC model act) will apply to disability plans as well as health plans. The consequence will be de novo review of claim denials with augmented discovery in many cases."
(Roy Harmon via Health Plan Law)

[Guidance Overview]
Small Employer Health Insurance Expense Tax Credit Official IRS Guidance
Excerpt: "The Notice addresses the following four issues: (1) which employers are eligible for the credit; (2) how to calculate the credit; (3) how to claim the credit; and (4) transitional relief for taxable years beginning in 2010."
(Proskauer Rose LLP)

Many Firms Could Be Hit in the Future by Cadillac Health Plan Tax, According to Study
Excerpt: "Benefit consultant Towers Watson & Co. of New York estimates that in 2010 the average cost for single coverage will be $5,184 and family coverage will cost $14,988. If costs increase at an 8% annual clip, more than 60% of the employer plans Towers Watson analyzed would be hit by the tax in 2018, the consultant estimates."
(Business Insurance)

Employer's Guide to Self Funded Health Care Plans
Excerpt: "Most self-funded or self insured employers want flexibility in making key decisions on benefits, administration and funding, yet need to limit their liability. Partial Self Funding or Self Insurance with Stop Loss Coverage for employer group health insurance is an attractive alternative to the fully insured market for cost conscious employers."
(Self Funding Conference)

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Executive Compensation; Benefits in General

[Guidance Overview]
IRS Issues Final Rule on Qualified Non-Personal Use Vehicles
Excerpt: "The IRS has added an item to the list of government-owned vehicles public employees may use for personal purposes occasionally without triggering the need to keep records of business vs. personal use. Effective May 19, the IRS will recognize 'clearly marked public safety officer vehicles' as qualified nonpersonal vehicles that enjoy an exemption . . . of the regulations, regardless of whether the employee using them is a fire or police department employee."
(Thompson Hine LLP)

Financial Reform Bill Could Require Companies to Recover 'Excess' Incentive-Based Compensation from Executive Officers in Connection with a Restatement
Excerpt: "The current version of U.S. Senator Christopher Dodd's financial reform bill contains a provision . . . that would require companies that filed a restatement to recover incentive-based compensation from executive officers, even if no one engaged in any misconduct . . . . [T]he U.S. House of Representative's financial reform bill does not contain a similar provision, and thus the final adoption of Section 954 is not ensured."
(McDermott Will & Emery)

Recouping Executive Pay: The Rise in Popularity of Clawbacks
Excerpt: "Clawbacks are being endorsed by shareholders and legislators as significant corporate governance tools to deter management from taking actions that could potentially harm the company's financial position; the objective is to eliminate - or, failing that, at least recapture - undeserved payouts to executives."
(Hay Group)

10 Trends That Are Changing the Shape of Workplace Benefits
Excerpt: "[E]stablishing and maintaining benefit programs that are competitive and distinctive requires an awareness of trends in the marketplace, in the population, in the legislative and regulatory worlds, and in the needs of the workers you hope to attract and retain. While product development and enhancements certainly can play a role, there are also the overarching issues that drive and shape those developments."

Supreme Court Rejects 'One Strike and Out' Rule for Deference to Plan Administrator's Decisions.
Excerpt: "The disposition by the lower courts should have made this an easy decision. Whatever the intricacies of trust law, requiring the plan to ignore the time value of money was without basis. The dissent makes an attempt to defend it, but the case should have been remanded to fashion a more reasonable remedy."
(Steptoe & Johnson LLP)

Webcasts and Conferences

"The Ins and Outs of EFAST2" Web Seminar
Nationwide on June 22, 2010
presented by SunGard Relius

"The Ins and Outs of EFAST2" Web Seminar
Nationwide on June 24, 2010
presented by SunGard Relius

Cash Balance Plans – Administrative Issues
Nationwide on June 16, 2010
presented by National Institute of Pension Administrators

Form 5500 Presentation - 2009 Plan Years
in New York on June 3, 2010
presented by International Society of Certified Employee Benefit Specialists - NY Metro Chapter

Identifying Controlled and Affiliated Service Groups
Nationwide on July 13, 2010
presented by National Institute of Pension Administrators

No One Is Bald On The Radio – What Your Website, Collateral, and Communications Say About You
Nationwide on June 24, 2010
presented by National Institute of Pension Administrators

Strategic and Tactical Action Plan Creation Workshop
Nationwide on June 3, 2010
presented by National Institute of Pension Administrators

Press Releases

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Newly Posted Employee Benefits Jobs

System Manager Retirement Service Center
for Providence Health and Services
in WA

Defined Contribution, Client Service Officer
for AllianceBernstein
in NY

VP, Defined Benefit Product Lead
for Prudential
in CT

VP, Project Management
for Prudential
in CT

Case Coordinator
for Northwestern Benefit Corporation of Georgia
in GA

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