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Health & Welfare Plans Newsletter

June 2, 2010

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[Guidance Overview]
SIMPLE Cafeteria Plans Available in 2011; Owners Can Only Be Covered in C Corporations (PDF)
7 pages. Excerpt: "SIMPLE cafeteria plans will be treated as meeting nondiscrimination requirements applicable to cafeteria plans if they meet minimum eligibility, participation, and contribution requirements.."
(Small Business Council of America)

[Guidance Overview]
Court Agrees With Employer's Decision to Not Offer COBRA Due to Employee's Gross Misconduct
Excerpt: "Because the courts have not agreed on a common standard to apply in gross misconduct cases, denials of COBRA coverage on account of gross misconduct should be made only after careful consideration. If, after obtaining legal advice, a plan decides to deny COBRA coverage, the employer should consider sending a letter to all affected qualified beneficiaries stating that COBRA coverage will not be offered."
(Employee Benefits Institute of America)

In Amicus Brief, Obama Administration Chooses Not to Support Employer Association's Petition for Supreme Court Certiorari Review of Ninth Circuit Decision Favoring San Francisco (PDF)
26 pages. Excerpt: "[I]n light of the new federal legislation, the Department of Labor has concluded that, at present, it would be premature to proceed with regulatory action. In the unlikely event that additional state or local governments choose to enact health care spending requirements like the [San Francisco program], the Department might reconsider whether the preemption issue has sufficient ongoing significance to warrant administrative action to address it. . . . The preemption issue does not warrant this Court's review at this time for the same reasons that the Department of Labor has determined not to take regulatory action on the issue at this time."
(American Benefits Council)

Employer Association's Supplemental Brief to Supreme Court in Golden Gate Restaurant Association v. City and County of San Francisco (PDF)
15 pages. Excerpt: "Petitioner respectfully submits this Supplemental Brief to bring to the Courtís attention new legislation -- the Patient Protection and Affordable Care Act . . . -- that undermines one of the grounds on which [the City and County of San Francisco] opposes the Petition [for certiorari]."
(American Benefits Council)

Federal Personnel Agency Opens Long-Term Care to Same-S.ex Partners
Excerpt: "The Office of Personnel Management on Tuesday took another step toward expanding benefits for the partners of g.ay and les.bian federal employees by finalizing a regulation that makes them eligible for long-term care insurance."

Major Health Plans Eye Ways to Reform Physician Payment Methods
Excerpt: "Several Blues plans are making changes to the way they pay primary care physicians -- with two plans focusing on the medical home model and another with a menagerie of options on the table -- in an effort to reduce health care costs."

Health Cost Risk and Optimal Retirement Provision: A Simple Rule for Annuity Demand
Excerpt: "For personal financial planning purposes, we develop a simple rule of thumb for annuity demand, based on expected health cost risk early in retirement, wealth at retirement, and minimum consumption levels. We show that the welfare costs from using the rule compared to the full life cycle model are small."
(Pension Research Council; registration required to download working papers)

Companies Offer Cash to Employees to Lose Weight
Excerpt: "Companies are betting that cash incentives will make employees want to lose weight and get healthier in other ways, The Associated Press reports. A third of companies in the U.S. offer such incentives."
(Henry J. Kaiser Family Foundation)

Judge Denies Extension for Federal Response to Health Reform Lawsuit
Excerpt: "A federal judge in Florida is not granting the federal government an extension of time to respond to a challenge to health care reform made by 20 states."
(Henry J. Kaiser Family Foundation)

Facing Health Reform and Health Benefit Strategies
Excerpt: "With the recent signing of the healthcare-reform law, insurance brokers are scrambling to educate clients about what they need to do, and when they need to do it."
(Human Resource Executive Online)

What the New Health Law Means for You
Excerpt: "The law will extend health insurance to 32 million currently uninsured Americans by 2019, and will also have an impact on how nearly every American buys insurance and what insurance must cover. Here's how you might be affected . . . ."
(Henry J. Kaiser Family Foundation)

Questions and Answers on Health Care Reform
31 questions with detailed answers.
(Warner Norcross & Judd LLP)

The New VEBAs
Excerpt: "Needless to say, the auto industry New VEBA Trust is a labor-management compromise of epic proportions. It was dictated by economic circumstances that, in recent years, wreaked havoc on the U.S. domestic auto industry (including, but surely not confined to, the market melt-down of 2008)."
(Pension & Benefits Blog)

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Executive Compensation; Benefits in General

House Benefits Bill Passes without COBRA, with Pension-Funding Relief and 401(k) Plans Fee Disclosure
Excerpt: "Among the 401(k) provisions in the bill, which passed 215-204, is a requirement that 401(k) service providers break down their fees into three categories: plan administration and recordkeeping fees, investment management fees and all other fees. Additionally, plan sponsors must list all fees subtracted from a worker's account on quarterly statements."
(Employee Benefit Adviser; free registration required)

Employers Hiring Fewer Full-Time Workers, More Contractors
Excerpt: "Many of the jobs employers are adding are temporary or contract positions, rather than traditional full-time jobs with benefits. With unemployment remaining near 10%, employers have their pick of workers willing to accept less secure positions."

Employee Ownership Update for June 1, 2010
NCEO Executive Director Corey Rosen discusses the following: The NCEO has released the 2010 version of its Employee Ownership 100, the 100 largest ESOP and other employee-owned U.S. companies. A new study of worker coops in France finds these companies are as productive as or possibly more productive overall than conventional firms in most industries. The Conservative-Liberal coalition in Britain has endorsed the expansion of employee ownership. The VEOC conference is on June 9.
(National Center for Employee Ownership)

Webcasts and Conferences

Early Retiree Reinsurance Program: Information You Need Now to Apply
Nationwide on June 10, 2010
presented by International Foundation of Employee Benefit Plans

Employee Benefits Conference: Dawn of a New Decade
in Minnesota on June 16, 2010
presented by Employers Association, Inc.

Fee Disclosure Under Final DOL 401(b)(2) Regs
Nationwide on July 15, 2010
presented by National Institute of Pension Administrators

Optimizing Processes in the TPA Environment
Nationwide on August 10, 2010
presented by National Institute of Pension Administrators

Press Releases

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Newly Posted Employee Benefits Jobs

Pension Consultant
for Advanced Pension Solutions, Inc.
in OH

Retirement Services District Manager - 401k Sales Hunter!!!!
for ADP Retirement Services
in CA, MA, MN, MO, NY, PA, TX, WA

Principal - Health & Welfare
for Buck Consultants
in CA

Plan Sponsor Marketing Specialist
for Financial Engines
in MA

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