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Health & Welfare Plans Newsletter

December 7, 2010

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[Guidance Overview]
How to Sort Through the Complications of the Small Business Health Care Tax Credit
Excerpt: "Part of the complication in claiming the credit involves the three methods that employers are permitted to use for calculating employees' hours of service for the taxable year: (1) counting actual hours worked; (2) using a days-worked equivalency; or (3) using a weeks-worked equivalency. Counting hours of service is important in determining how many full-time equivalent employees a company has, and thus is important in determining whether the company is eligible for the credit."
(Wolters Kluwer)

[Guidance Overview]
Group Health Plans: Are You Ready for Healthcare Reform? (PDF)
7 pages. Excerpt: "This LawFlash reviews planning opportunities and required changes, notices, and plan amendments that should be on every plan sponsor's to-do list at the end of 2010."
(Morgan, Lewis & Bockius LLP)

[Guidance Overview]
Tax-Advantaged Accounts for Health Care Expenses: Side-by-Side Comparison (PDF)
11 pages. Excerpt: "This report provides brief summaries of the four [types of tax-advantaged] accounts and compares them with respect to eligibility, contribution limits, use of funds, and other characteristics for tax year 2010. The report then discusses changes to the accounts resulting from the enactment of the Patient Protection and Affordable Care Act . . . . The final section of the report covers participation levels in these accounts."
(U.S. Congressional Research Service)

Texas Insurance Commissioner Forbids Insurers' Provisions that Allowed Them to Interpret Policies
Excerpt: "Health, life and disability insurers will no longer have blanket authority to decide what their policies do and don't cover in Texas, under rules approved Monday . . . . The decision . . . ends long-standing provisions in most health and disability plans - called discretionary clauses - that give insurers the right to interpret their policies and decide what benefits must be paid."
(The Dallas Morning News)

Employers' Cost Projection Fell Far Short of Actual Health Care Costs in 2010, Survey Reveals
Excerpt: "A 6.9% spike in per-employee costs -- the biggest since 2004 -- caught many by surprise, as the expected increase of less than 6% was left in the dust, according to Mercer's 2010 survey of 2,836 employer-sponsored health plans, released in late November."

Should Employers Remove Genetic Information That Was Placed in Personnel Files Prior to GINA's Effective Date?
Excerpt: "Genetic information placed in personnel files prior to November 21, 2009, GINA's effective date, need not be removed. An employer will not be liable under GINA for the mere existence of that genetic information in a personnel file; however, disclosing that genetic information to a third party is prohibited."
(Wolters Kluwer)

Aflac Survey Highlights Demand for Dental Plans
Excerpt: "A recent Aflac survey of 1,000 working Americans suggests there will be increased opportunities for brokers and advisers to sell voluntary dental plans, particularly among those between the ages of 35 and 54 in a post-health care reform market."
(Employee Benefit News; one-time free registration required)

Health Care Reform, Reward Strategy and Workforce Planning (PDF)
7 pages. Excerpt: "In deciding whether to offer health care in 2014 and beyond, and who should be offered health care, employers with 50 or more employees need to take into account PPACA's 'pay or play' provisions. They will owe substantial penalty taxes if they do not offer health care coverage to their full-time employees, or do not offer coverage to substantial segments of their employee population at prices they can afford."
(Thomson Reuters via Hay Group)

The 2007-09 Recession and Health Insurance Coverage
Excerpt: "Loss of employment and declining incomes meant that five mil.lion Americans lost employment-based health insurance during the recent economic recession (2007-09). All groups of Americans were affected, but the growth in the number of uninsured people was particularly noticeable for whites, native-born citizens, and residents of the Midwest and South."
(Health Affairs)

Health Savings Account Answer Book answers over 600 questions in a format that's quick and easy to use. It tells you virtually everything you have to know to profit from HSAs - from how they work, what they offer participants, and how they can benefit employers to helping you determine how well they will fit your company or clients. It answers key questions on all aspects of HSA establishment, administration, and compliance - including rules and penalties, medical coverage, contributions and deductions, distributions, rollovers and transfers, and more.
Sponsored by Aspen Publishers

Benefits in General; Executive Compensation

[Guidance Overview]
IRS Expansion of Code § 409A Correction Guidance (PDF)
3 pages. Excerpt: "Notice 2010-80 also expands the eligibility for document correction relief under Notice 2010-6 to include stock options and stock appreciation rights that were intended at the time of grant (or upon a modification pursuant to applicable transition relief) to be subject to, and compliant with, Code § 409A."
(Sutherland Asbill & Brennan LLP)

[Guidance Overview]
IRS Expansion of Voluntary Correction Program for Section 409A Plan Document Errors
2 pages. Excerpt: "The IRS recently released Notice 2010-80, which expands the types of deferred compensation arrangements that are eligible for correction under the plan document correction program. The new guidance also limits the situations under which the service provider must submit information regarding the correction to the IRS."
(PricewaterhouseCoopers LLP)

Why Older Workers Offer Better Value Than Younger Ones
Excerpt: "[Older] workers bring a lifetime of skills to their jobs and can be highly motivated and productive members of the workplace, according to Wharton professors. Many of the stereotypes that prevent employers from hiring and making good use of older workers are merely myths, they say."
(Wharton School of the University of Pennsylvania)

Upcoming Bills May Include Moves to Eliminate Tax Preferences for Insurance and Retirement Plans
Excerpt: "One of the points that likely will come out as the Congress wrestles with tax reform is that tax expenditures for retirement plans and the buildup of cash value in life insurance products are tax deferrals rather than deductions . . . ."
(Investment News; one-time registration required)

Press Releases

Newly Posted Employee Benefits Jobs

Business Development Manager
for Pension Administration Firm
in NJ

Vice President, Executive Relationship Manager, San Francisco
for New York Life Retirement Plan Services
in CA

Benefits Manager
for PEO
in TX

Senior Client Relationship Manager
for The Newport Group
in FL

Plan Administrator
for The Newport Group
in FL

Financial Analyst
for The Newport Group
in FL

Peer Reviewer – Temporary Assignment 1/1/11 – 5/31/11
for The Angell Pension Group, Inc.

DC Administrator
for Third Party Pension Administration and Consulting Firm
in OH

Fixed Income Product Analyst
for Prudential
in NJ

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