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May 25, 2010

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[Official Guidance]
Text of IRS Rev. Proc. 2010-22: HSA Limitations for 2011 -- No Change from 2010 Limitations (PDF)
2 pages. Excerpt: "The amounts for 2011 are unchanged from the amounts for 2010 because, after the application of the cost-of-living adjustment rules . . . the changes in the Consumer Price Index for the relevant period do not result in changes to the amounts for 2011. . . . For calendar year 2011, the annual limitation on deductions under § 223(b)(2)(A) for an individual with self-only coverage under a high deductible health plan is $3,050."
(Internal Revenue Service)

[Guidance Overview]
Is the Self-Employed's Spouse an Employee for the Small Employer Health Insurance Credit Purposes?
Excerpt: "A close look at the § 45R credit for small business employee health insurance expenses reveals a bit of an anomaly. § 45R(e)(1)(A) excludes self-employed individuals, S corporation two % shareholders . . ., and five % owners of eligible small businesses . . . from the definition of an employee. The attribution rules referred to in §§ 1372(b) and 416(i) clearly include the spouses, so that spouses of 2% shareholders and 5% owners are not treated as employees for purposes of the credit. But what about a spouse of a self-employed individual or owner-employee?"
(Tax Management Inc.)

Health Care Costs and Complications Under Health Care Reform
Excerpt: "While some companies have pondered the possibility of paying a government penalty for dropping employee-healthcare benefits, most experts say the likelihood of that happening is miniscule once all financial implications are weighed. But most experts also expect medical costs -- and possibly taxes -- to increase."
(Human Resource Executive Online)

2011 Design Considerations under Health Care Reform
Excerpt: "Many employers are already planning revisions to their medical plans for 2011. However, under health reform, if 'grandfathered plans' (generally plans with at least one participant on March 23, 2010) make changes in their benefit structure, they may lose 'grandfathered' status. Thus, employers are asking . . . ."
(Haynes and Boone, LLP)

Most Employers to Seek Early Retiree Care Subsidy
Excerpt: "In a survey of 245 large employers released Tuesday, Hewitt Associates Inc. found that 76% with early retiree health care plans intend to seek reimbursement under the program."
(Business Insurance)

'Grandfather' Rule Could Mean More Time to Comply With Health Reform, but Could Cost Health Plans
Excerpt: "For health insurers, maintaining separate administrative platforms for their grandfathered products and non-grandfathered products could be burdensome, says Chip Kerby, an employee benefits attorney at the Washington, D.C.-based law firm Liberte Group LLC."

The Relationship Between Public Law and Voluntary Action in Enhancing Work/Life Balance for Caregivers
Excerpt: "The Paper argues that the law should play a role in facilitating optimal, individualized accommodation of working caregivers. Drawing on existing and pending legislation, it argues for the creation of a statutory 'right to request' that would protect workers from retaliation for seeking accommodations and would require employers to consider such requests in good faith."
(Social Science Research Network)

Lines Blurring between Wellness and Disease Management Services
Excerpt: "With wide acceptance of a link between lifestyle and the onset of chronic illness, disease management firms are incorporating wellness and health promotion into their traditional service model. Unlike a more fragmented approach in which wellness and disease management services are provided by separate companies, usually to different groups of plan members, an integrated approach puts all plan members together so they can access both services regardless of health status."
(Workforce Management; free registration required)

Most Employees Using Employer Health Care Plan to Continue
Excerpt: "Most U.S. workers who use employer sponsored health care coverage plan to continue to do so in the future, according to a survey conducted jointly by the National Business Group on Health and Hewitt Associates. The survey of more than 3,000 American workers and their dependents, conducted in March 2010, found that the majority of Americans (61%) currently use employer-sponsored health care coverage and participate in healthy living/wellness programs. Among those, nearly half (47%) plan to continue to do so in the next three-to-five years."

Guaranteed Availability and Renewal of Coverage Under Health Care Reform
Excerpt: "[H]ealth insurance issuers that offer health insurance coverage in the individual or group market in a state are required to 'accept every employer and individual in the state that applies for such coverage,' except as permitted under the special rules for network plans and insurers that no longer have the financial capacity to underwrite additional coverage."
(Wolters Kluwer)

Chart on Health Care Reform: A Quick Glance at the Major Changes That May Affect Employers
The chart notes which changes apply to Grandfathered Plans.
(Warner Norcross & Judd LLP)

Direct Contracting with Health Care Providers Can Cut Costs
Excerpt: "[An] effective method of reducing cost is cutting out the middleman - the insurance company or health plan - by contracting directly with health care providers. This model, although not as widespread as health promotion initiatives, has produced exceptional results for companies that were not afraid to move away from the mainstream model of managed care."
(Employee Benefit News; free registration required)

Unwilling to Lose Grandfathered Status, Employers Fight Making Mental Health Parity Changes
Excerpt: "Between trying to comply with mental health parity regulations, due to take effect July 1, and implement provisions of health care reform, leaders from the American Benefits Council, National Retail Federation and U.S. Chamber of Commerce say benefits pros are at their limit. According to a recent report in Business Insurance, the groups are asking the Employee Benefits Security Administration to put off for a year the effective date for the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act."
(Employee Benefit News; free registration required)

Q&A: Health Care Reform Update
Excerpt: "With U.S. health care reform legislation now on the books, three consultants in Towers Watson's Health and Group Benefits practice examine the implications for employers."
(Towers Watson)

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Executive Compensation; Benefits in General

Executive Pay Passes 'Stress Test' During the Recession
Excerpt: "Towers Watson's analysis of 176 Fortune 500 companies' recent proxy filings shows that, over the past two years, executive pay programs at most companies have come through a difficult 'stress test' with flying colors as pay outcomes have reflected the significant downturn in the economy, as well as the initial phases of the recovery."
(Towers Watson)

States Face Hurdles in Cutting Worker Benefits
Excerpt: "[M]any states can only cut benefits for new hires and cannot take away benefits for current workers or retirees. That is partly because all but a dozen or so states let public unions negotiate contracts, said Joseph Slater, a professor at the University of Toledo College of Law. 'Once you've negotiated a contract, you're pretty much bound by the contract,' he said."
(Reuters via The New York Times; free registration required)

U.S. Supreme Court Sets New ERISA Attorneys' Fees Standard
Excerpt: "Justice Clarence Thomas, writing for the high court in Hardt v. Reliance Standard Life Insurance Co., ruled that the person only has to achieve 'some degree of success on the merits (of the case)' and not meet the higher standard of being a 'prevailing party' to be eligible for the attorneys' fees award at the court's discretion."

Webcasts and Conferences

"Fundamentals of 401(k) and Other Qualified Plans" - Minneapolis
in Minnesota on June 23, 2010
presented by SunGard Relius

CLE Program: Ethics for Benefits Professionals
in New York on June 17, 2010
presented by WEB (Worldwide Employee Benefits Network ), New York Chapter

The ABCs of Pension Law
in California on June 3, 2010
presented by Western Pension & Benefits Conference - Orange County Chapter

Press Releases

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