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Health & Welfare Plans Newsletter

June 14, 2010

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[Guidance Overview]
HHS's Proposed New Recordkeeping System for the Early Retiree Reinsurance Program (PDF)
3 pages. Excerpt: "The notice discusses the categories of individuals covered by the [new System of Records (SOR)], categories of records that will be maintained in the system, routine uses of records in the system, and privacy policies and practices regarding the data."
(Hewitt Associates)

[Guidance Overview]
Additional Tax on Distributions from HSAs and MSAs under Health Reform
Excerpt: "The additional tax on distributions from health savings accounts (HSAs) and Archer medical savings accounts (MSAs) not used for qualified medical expenses is increased to 20% of the amount of the distribution included in gross income."
(Wolters Kluwer)

White House to Issue New Rules That Strongly Discourage Employers from Cutting Health Insurance Benefits
Excerpt: "The rules limit the changes that employers can make if they want to be exempt from certain provisions of the health care law [and m]any employers want the exemption because it allows them to keep their existing health plans intact with a minimum of changes."
(The New York Times; free registration required)

New Health Care Grandfathering Rules May Limit Employer Flexibility in Improving Benefit Plans
Excerpt: "Unofficial draft interim final rules on grandfathering status under the new health reform law that were circulated this week, which the White House has since said should not be relied upon, would significantly limit the ability to restructure health benefits plans, increase cost-sharing, or change contribution levels if employers seek to retain grandfathered status."
(HR Policy Association)

Changes Under Health Care Reform to the Over-the-Counter Medicine Rules
Excerpt: "One provision that is effective fairly quickly is the change to the over-the-counter drugs/medicines rules in Flexible Spending Accounts (FSA), Health Reimbursement Arrangements (HRA) and Health Savings Accounts (HSA)."

Administration Estimates Project Big Shifts in Workplace Health Care
Excerpt: "Draft regulations being developed by the Obama administration project that more than half of employer health care plans may lose their grandfathered status - and therefore be required to comply with the provisions of health care reform signed into law . . . ."

Not Taking Medication As Prescribed Fuels More Than $100 Billion Dollars in Health Costs Annually Because Those Patients Often Get Sicker
Excerpt: "Now, a controversial, and seemingly counterintuitive, effort to tackle the problem is gaining ground: paying people money to take medicine or to comply with prescribed treatment. The idea, which is being embraced by doctors, pharmacy companies, insurers and researchers, is that paying modest financial incentives up front can save much larger costs of hospitalization."
(The New York Times; free registration required)

Connecticut's Family Violence Leave Law
Excerpt: "Connecticut Governor Jodi Rell has signed a new law that entitles employees who are victims of family violence to take leave from work."
(Jackson Lewis LLP)

An employer writes:

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Executive Compensation; Benefits in General

[Guidance Overview]
For Code Section 409A Compliance, Time of Payment Is Also Key
Excerpt: "When the IRS released the Code Section 409A document compliance correction guidance . . . some unexpected nuances were revealed, including one that caught many practitioners off guard -- getting the timing of a release and payment of deferred compensation to work together."
(Nelson Mullins Riley & Scarborough LLP)

Judicial Interpretation Has Made Things Worse for Benefit Plan Participants Under ERISA Than Had the Statute Never Been Enacted
Excerpt: "Given that the Act's stated purpose was to protect benefit plan participant, this is a surprising conclusion to have to reach. Nonetheless the argument is strong, and is validated in part by the thousands of cases that have accumulated in which plan participants/plaintiffs have been forced to argue ERISA does not apply to their claims, as a precondition to salvaging those claims."
(Social Science Research Network)

Benefits Education Satisfaction Reduction, According to Survey
Excerpt: "A news release about the survey by Harris Interactive for Unum said 29% of the 1,106 working adults polled gave their benefits education high marks in 2009, down from 39% the year before."

Presidential Memorandum and OPM Final Rule Extend Certain Benefits to Same-S.ex Domestic Partners of Federal Employees
Excerpt: "EBIA Comment: As noted by OPM, a number of important federal benefits cannot be extended to domestic partners without legislative changes. (OPM has not yet finalized proposed regulations that would extend certain absence and leave benefits to include domestic partners (among other individuals).)"
(Employee Benefits Institute of America)

Webcasts and Conferences

It's Not Too Late! Automating Open Enrollment
Nationwide on June 24, 2010
presented by TRI-AD

Press Releases

Secretaries Solis and Sebelius to Hold Press Conference on Affordable Health Care
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

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Senior Plan Consultant
for BPA, A BPAS Company
in PA

Account /Client Services Manager (Insurance/TPA)
for Zenith Administrators
in WA

401(k) Sales Consultant
for Nyhart
in IN

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