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Health & Welfare Plans Newsletter

December 6, 2010

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No matter how benefits-savvy your employees may be, today's health care environment can confuse the most sophisticated consumer. That's why companies large and small use BeneCom for their benefits communication. We know benefits and we understand what employees need to know to make them work - for themselves and for you. And while we're at it, we make your life a little easier, too.

For more information visit our site or call (860) 674-2626, Ext. 2001


[Guidance Overview]
District Court Within Sixth Circuit Holds that Plan Language Overrides Common Fund Doctrine
Excerpt: "A recurring issue for health plan subrogators is whether a state law -- or federal common law -- common fund doctrine requires a health plan to reduce it's subrogation amount by one-third. In Electric Energy, Inc. v. Lambert, . . . the Court held that the Illinois common fund doctrine was preempted by ERISA and plan language rejecting the common fund doctrine was sufficient to preclude application of a federal common law common fund doctrine."
(Health Subrogation Blog)

[Guidance Overview]
IRS Provides Medical Loss Ratio Guidance to the Blues
Excerpt: "In Notice 2010-79, the Internal Revenue Service provides interim guidance for 2010 for certain Blue Cross and Blue Shield organizations in complying with the medical loss ratio . . . provisions of the Patient Protection and Affordable Care Act . . . ."
(Wolters Kluwer)

[Guidance Overview]
IRS Releases More Guidance and Form on Small Business Health Care Tax Credit
Excerpt: "The notice says that leased employees are counted in computing a small business's full-time equivalent employees for purposes of the credit; however, the business cannot take into account premiums paid on behalf of that leased employee by the leasing organization."
(American Institute of Certified Public Accountants)

[Guidance Overview]
IRS's 2011 Versions of Forms 1099-SA and 5498-SA for HSA, Archer MSA, and Medicare Advantage MSA Trustees and Custodians
Excerpt: "Note that the clarification about excess employer contributions (and related earnings) applies only to amounts that are withdrawn by the employer. An employer can ask a trustee or custodian to return excess contributions in very limited circumstances -- when the contributions were made to the account of an employee who never was HSA-eligible or when they exceed the statutory maximum contribution limit . . . ."
(Employee Benefits Institute of America)

[Guidance Overview]
HHS Regulations on Medical Loss Ratio Requirements, Implementing Reporting and Rebate Requirements for Insurers
Excerpt: "We note that ERISA health plans (generally those of private-sector employers) are already subject to established rules governing the treatment of insurer rebates. Under these rules, depending on various factors (including the degree to which plan participants contribute toward premiums), rebates may qualify as plan assets (in whole or part), which must be used exclusively for plan purposes and may even have to be held in trust."
(Employee Benefits Institute of America)

Federal Budget Deficit Commission Is Looking at the CLASS Act As a Possible Source of Deficit Relief
Excerpt: "The CLASS Act is supposed to create a voluntary worksite LTC benefits program. Insurance groups and actuaries at the Centers for Medicare & Medicaid Services have criticized the program and argued that it will be actuarially unsound. Budget analysts say the CLASS Act would reduce the cost of implementing the Affordable Care Act up until 2014 but then would add $76 bil.lion to the deficit from 2015 to 2020."
(Milliman, Inc.)

Work/Life Balance Is Drawing More Attention from White House and Other Policymakers
Excerpt: "At a Focus on Workplace Flexibility Conference, held at Georgetown Law School in Washington last week, officials from the White House, Pentagon, Department of Labor, Equal Employment Opportunity Commission, Internal Revenue Service, academia and corporate America all spoke in favor of the concept -- whether they called it work/life balance, work/life fit or work/life integration."
(Human Resource Executive Online)

IRS Additional Guidance on Small Business Health Care Tax Credit, Including Final 2010 Form 8941 and Instructions
Excerpt: "The new guidance includes a notice, additional FAQs, a final version of Form 8941 and its instructions, and a draft Form 990-T (the reporting form for eligible tax-exempt small employers)."
(Employee Benefits Institute of America)

First Dollar Preventive Care Requirements Create Complexity
Excerpt: "At first glance, this seemed like a fairly easy rule for most health plans sponsors, since many plans already provided first dollar coverage for most preventive services. However, administering the new requirements can be quite complex and further guidance is needed."
(Faegre & Benson LLP)




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Benefits in General; Executive Compensation

[Guidance Overview]
U.S. Supreme Court Mulls ERISA Claim Against Insurer Cigna
Excerpt: "A class-action pension-benefits claim by present and former Cigna employees under [ERISA] could have an unsettling effect on plan sponsors if the Supreme Court does not overturn two lower-court rulings in the nine-year-old case."
(CFO.com)

[Guidance Overview]
U.S. Supreme Court to Rule on Remedies for Deficient Employee Communications
Excerpt: "Deficient SPDs have now moved to the front burner, as the U.S. Supreme Court heard oral argument on November 30 in CIGNA v. Amara. In this case the Supreme Court will rule on the correct remedies when an SPD does not describe a material limitation on pension benefits (i.e., that participants might not accrue any new benefits for a period of time) contained in the plan document."
(Osler, Hoskin & Harcourt LLP)

[Guidance Overview]
The U.S. Supreme Court to Rule on Remedies for Deficient Employee Communications
Excerpt: "Deficient SPDs have now moved to the front burner, as the U.S. Supreme Court heard oral argument on November 30 in CIGNA v. Amara. In this case the Supreme Court will rule on the correct remedies when an SPD does not describe a material limitation on pension benefits (i.e., that participants might not accrue any new benefits for a period of time) contained in the plan document."
(Osler, Hoskin & Harcourt LLP)

[Guidance Overview]
IRS's Additional 409A Correction Relief (PDF)
2 pages. Excerpt: "On November 30, the [IRS] issued Notice 2010-80 . . ., which provides additional relief for certain corrections of Code section 409A documentation and operational errors. Some of the relief in the Notice expires at the end of 2010, so an employer needs to act very quickly to take advantage of this relief."
(Groom Law Group)

Business Mileage Rate Up One Cent for 2011
Excerpt: "Beginning on January 1, 2011, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 51 cents per mile for business miles driven, 19 cents per mile driven for medical or moving purposes, and 14 cents per mile driven in service of charitable organizations."
(PLANSPONSOR.COM)

Employers Showing Bit More Largesse This Holiday Season
Excerpt: "After a downturn in 2008 and 2009, employers appear to be 'in a more expansive mood,' according to an annual holiday practices survey by BNA, a business research organization."
(The Kansas City Star)


Webcasts and Conferences

Global Investment Markets: Looking Ahead to 2011
Nationwide on January 11, 2011
presented by Buck Consultants


Press Releases


Newly Posted Employee Benefits Jobs

Senior Plan Consultant
for Scholz, Klein & Friends Enlightened Retirement Group, Inc.
in TX

Pension Administrator
for Small employee benefits consulting/TPA firm
in PA

Retirement Education Specialist
for The Newport Group
in NC

Director of Benefits
for Metro Transit - St. Louis
in MO

Director, Financial Reporting
for Transamerica Retirement Services
in CA

IT&C Relationship Manager 4
for U.S. Bank
in MO




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