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October 11, 2012          Get Retirement News  |  Advertise  |  Unsubscribe
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Employee Benefits Jobs

Pension Administrator II
for Beneco in AZ

Benefits Specialist
for Beneco in AZ

Pension Paralegal / Employee Benefits Paralegal
for Pension Corporation of America in OH

Executive Director
for BTHR Solutions (for NEEBC) in MA

Compliance Analyst
for Growing Firm in Greater Cincinnati (Southwestern Ohio/Northern Kentucky) in OH

Institutional Trust Relationship Manager
for BMO Financial Group in WI

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Webcasts and Conferences

Women in Retirement: Managing Longevity Webcast
Nationwide on October 30, 2012 presented by InvestmentNews

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Ohio District Court Finds Plaintiff's LTD Claim Time Barred by the Limitations Term in the Plan
"The federal district court stated that for ERISA claims, courts normally apply the most analogous state statute of limitations; however, when the plan contains a contractual statute of limitations, courts generally apply the plan's provision provided that the plan's stipulated limitations period is reasonable. In Ohio, the applicable statute of limitations for breach of written contract claims is 15 years. In this case, the Court held that the plaintiff's action with respect to the 2001 claim was time barred by the contractual limitations period in the Plan which the Court deemed to be reasonable." (Haynes and Boone, LLP)


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What Happens When Benefits Come with a Bigger Price Tag?
"CalPERS counts about 150,000 state and local government workers in its long-term care insurance program, which pays for nursing and convalescent home stays.... Now CalPERS' staff has recommended a whopping rate hike of up to 85 percent and a lower-benefit, lower-cost alternative care plan." (Sacramento Bee)

Not Shopping for Medicare May Cost You in 2013
"Although the cost of Medicare Advantage plans will rise modestly next year, many of the top prescription drug plans are boosting premiums by double digits. What's worse, the 2013 Part B premium (outpatient services) -- which won't be announced until the end of October -- is projected to jump 5%-10% next year." (Morningstar)

Trucker Wellness Programs Aim for Less Girth Behind the Wheel
"From trucking companies embracing wellness and weight-loss programs to gyms being installed at truck stops, momentum has picked up in recent years to help those who make their living driving big rigs get into shape." (STLtoday.com)

Kodak Asks Bankruptcy Court Permission to End Retiree Medical, Other Benefits at End of Year
"The company said it reached an agreement with the court-appointed committee of retirees to pay a total of $650 million in claims and $7.5 million in cash into a fund that could be used for future payments in exchange for eliminating its current $1.2 billion liability for medical, dental, life insurance and survivor income benefits. A company spokesman said pensions would not be affected. It said the other benefits cost about $10 million monthly and the change is essential to emerging successfully from Chapter 11 protection." (The Washington Post; free registration required)

Military Families Must Pay to Extend Health Benefit Coverage to Adult Dependents
"A popular component of the 2010 Affordable Care Act allowing adult children to stay on their parents' health care plans until age 26 has been a little less popular among military members. That's because military families covered by TRICARE must pay as much as $200 a month to benefit from extended coverage.... Most families in private plans do not pay for the extension." (GovExec.com)

Selling Health Insurance Across State Lines: An Assessment of State Laws and Implications for Improving Choice and Affordability of Coverage
"[W]hile across state lines proposals cite many important goals -- such as enhancing consumer choice, increasing competition and making insurance more affordable -- the across state lines proposals as currently enacted in six states do not address the true drivers of health insurance costs nor do they adequately take into account the complexity of how insurance products are sold and regulated. The proposals also underestimate the administrative hurdles necessary for full implementation. As a result, none of the across state lines laws resulted in a single insurer entering a new market or the sale of a single new insurance product." (Robert Wood Johnson Foundation)

Is Medicare Both Solvent and Sustainable?
"At a time when Medicare is at the forefront of national political debate, it is essential to think about both Medicare's solvency and sustainability without muddling the two terms.... Solvency is a measure of whether Medicare's two trust funds ... are able to pay the full cost of benefits prescribed by law on a timely basis.... Sustainability asks whether future Medicare spending is at a level that Americans are likely to be willing and able to pay for, based on projections of economic growth and spending." (National Academy of Social Insurance)

If the DOL Auditor Comes Knocking, Are You Ready to Answer?
"The [DOL] has begun to audit health and welfare plans for compliance with the [ACA]. What is the DOL looking for during an audit, and what steps might you have to take to prepare for the possibility that your plan will be subject to one?" (Wolters Kluwer Law & Business)

Boomers 5-10 Years from Retirement Cite Rising Healthcare Costs and Social Security as Top Economic Issues
"Regardless of party affiliation, Transition Boomers -- those ages 55 to 65 who are less than 10 years away from retirement -- agree that rising healthcare costs will have the greatest effect on their retirement outlook, according to [a recent survey] ... Sixty-seven percent of all Transition Boomers listed healthcare expenses as their top concern, with Republicans at 64%, Democrats at 69%, and Independents at 66%. Social Security ranked second at 53% for all Transition Boomers, followed by tax payment changes (31%), rising national debt (26%), unemployment (19%) and education (4%)." (Allianz Life)

IRS ACA Guidance on Full-Time Employee Definition and 90-Day Waiting Period (PDF)
"The release of Notices 2012-58 and 2012-59 marks an important step in the interpretation and application of the ACA employer shared responsibility and waiting period limitation requirements. The notices provide substantial modifications to previous approaches as well as helpful clarifications for employers, plans, and insurers. Moreover, these notices can be relied on at least through the end of 2014." (Groom Law Group)

Keep Your Sanity During Open Enrollment
"Open enrollment can be a stressful time for HR professionals who work with benefits. Often, management doesn't have a true picture of the time and effort that go into making this event successful. The following are a few simple suggestions ... Start planning early.... Develop a written plan.... Include department contacts.... Communicate effectively.... Involve the experts." (Society for Human Resource Management)

Open Enrollment: Help Employees Make Better Health Care Choices
"Encourage employees to start by evaluating how they and their family used health care in 2012. Consider how much was spent out-of-pocket on deductibles, flat-dollar co-payments and percentage-of-cost co-insurance, the number of doctor visits and the cost of ongoing medications." (Society for Human Resource Management)


Michigan Small Businessman Challenges ACA Contraception Mandate
"Religious freedom has everything to do with health insurance and business. No one wants those engaged in business to check their moral beliefs at the door of the manufacturing floor or the trading room. Up to this point, health-care regulations have allowed [this business owner] to design a plan that allows [him] to live out [his] commitment to social justice by offering good wages and benefits to [his] associates. [His company has] designed an award-winning plan that promotes employees' overall health and well-being and minimizes their financial risk.... But now the mandate's attack on religious freedom endangers [his] ability to offer those benefits." (National Review)


A Reality Check: Private Insurance Exchanges
"Sears, Darden Restaurants and some others have partnered with the benefits consulting company Aon Hewitt to create their own private health insurance exchange, and are enrolling employees.... They've partnered with insurers across the country to develop standardized plan options, and effective structures for employees to figure out which ones to buy.... [T]he model is a radical departure from what most large employers do today, and is strikingly creative and innovative." (BestDoctors.com)

Benefits in General; Executive Compensation

[Official Guidance]

Text of BATS Exchange Proposed Rule to Establish Listing Standards for Compensation Committees, as Amended (PDF)
[BATS operates two stock exchanges in the U.S., the BZX Exchange and the BYX Exchange, which currently account for about 11-12% of all U.S. equity trading on a daily basis.] Excerpt: "The Exchange proposes ... to require that,... in evaluating the independence of a director [who participates in determining the compensation of executive officers], the board of directors of a Company shall consider the following factors: (i) the source of compensation of the director, including any consulting, advisory or other compensatory fee paid by the Company to such director; and (ii) whether the director is affiliated with the Company, a subsidiary of the Company, or an affiliate of a subsidiary of the Company.... Additionally, the Exchange is proposing ... to permit the compensation committee of a Company, acting in its capacity as a committee of the Company's board of directors and in its sole discretion, to retain or obtain the advice of a Compensation Consultant. The Company must provide for appropriate funding, as determined by the compensation committee, for payment of reasonable compensation to a Compensation Consultant retained by the compensation committee.... [T]he Exchange is proposing that Independent Directors of a Company ... (i) shall be directly responsible for the appointment, compensation and oversight of the work of any retained Compensation Consultant; and (ii) shall not be required to implement or act consistently with the advice or recommendations of the retained Compensation Consultant, nor be restricted in their ability or obligation to exercise their own judgment in fulfilling their duties.... The Exchange is also proposing ... to require foreign private issuers to comply with the Compensation Consultants requirement[.]" (BATS Exchange)

[Official Guidance]

Text of Chicago Board Options Exchange Proposed Rule Change to Establish Listing Standards for Compensation Committees (PDF)
"The Exchange believes that the current definition of 'independent director' meets the criteria listed for determining independence requirements under the New Rule.... The Exchange believes that independence of compensation committee members is important to ensure that there exist no undue influences in the compensation of executive officers. Further, in these times during which executive compensation has (understandably) fallen under some scrutiny, it is important to provide the appearance of a transparent and not-unduly-influenced process to determine executive compensation, and an exception that allows issuers to have nonindependent directors influence compensation can have a damaging impact on the markets.... New Rule [10C-1] discusses the retention of compensation consultants, independent legal counsel and other compensation advisers to assist the compensation committee of an issuer in determining compensation for executives. [CBOE] Rule 31.10 currently does not speak to this issue. Therefore, the Exchange proposes to adopt the provisions of the New Rule regarding this issue in a substantively identical manner to that in the New Rule in new Interpretation and Policy to Rule 31.10." (Chicago Board Options Exchange)

[Guidance Overview]

NYSE and NASDAQ Issue Proposed Listing Rules on Compensation Committee Independence Standards (PDF)
"Both exchanges' proposed rules adopt, without modification, the requirement that compensation committees must consider six independence factors prior to the retention of an adviser. In anticipation of the eventual implementation of compensation committee standards, ... many public companies [have begun] to assess the independence of their advisers against the six factors. This assessment will be required prior to the retention of an adviser and, at least annually, to determine whether a conflict has arisen due to the work of the consultant that is subject to disclosure." (Meridian Compensation Partners, LLC)

[Guidance Overview]

Additional Medicare Tax in 2013 Might Make Acceleration of Executive Compensation Desirable by Year-End
"Employers looking to lessen the burden of this new tax on their employees should consider whether there are opportunities to accelerate the inclusion of amounts in wages in 2012 for employment tax purposes. For example, for nonaccount balance nonqualified deferred compensation plans (e.g., defined benefit-type supplemental executive retirement plans), employers have the option of including the value of vested benefits prior to the actual payment or the date the amount of the benefit is reasonably ascertainable. An employer could accelerate inclusion of vested amounts in wages in 2012 to reduce taxes for its employees." (Morgan, Lewis & Bockius LLP)

How Do Employers Count Unexcused Absences When FMLA Medical Certification is Not Returned?
"The regulations tell us that any day following Day 15 can be counted as unexcused absences until the employee provides sufficient certification.... Interestingly, the regulations further state that, if the employee never returns the certification, 'the leave is not FMLA leave.'" (FMLA Insights)

Fire Authority Liabilities Doubled to a Half-Billion Dollars in 7 Years in Orange County, California
"On top of pensions, [the Orange County Fire Authority] has piled what it owes workers for medical benefits once they retire, workers' compensation, and for vacation, sick and other leave time earned but not taken ... Here, then, is the picture that emerges: Over the last seven years, OCFA's total long-term obligations have more than doubled, to $558 million. That happens to be twice as much as its general fund budget this year ($282 million)." (Orange County Register)

Cypen & Cypen Newsletter for October 11, 2012
Covers employee benefit developments with an emphasis on governmental plans. Topics in this issue include: Associations Tackle Public Pension Funding Issue; Florida Supplemental Premium Tax Distribution; Boomer Women Feeling More Financially Insecure Than Men; EBSA Says Public DC Plans Should Mimic Corporate Fee Disclosure; Questions Every Client Should Ask (and Advisors Should Be Prepared To Answer). (Cypen & Cypen)

Online Avatars and Cyber Concierges Walk Workers Through Benefits
"From increasing involvement and understanding of benefits during the open enrollment process to guiding a plan participant through a wellness program, interactive technology is becoming an ever more important and prominent part of the employee benefits communication package." (Employee Benefit News)

Execs Say Benefits More About Retention Than Attraction
"In a pair of recent interviews, executives from two of the 10 companies top-ranked for employee financial wellness by the Principal Financial Group both stressed that benefits programs should be tethered as closely as possible to retention and customer satisfaction. Good health care and retirement options are attractive to new hires, they say, but the real return on investment comes with nurturing someone through the company." (Employee Benefit News)

Sixth Circuit Decision Provides Employer Tax Relief and Refunds on Severance Payments Not Subject to FICA
"Employers who collected and paid FICA taxes on severance payments (and their employees) may be entitled to refunds of those FICA taxes. With rates as high as 15.3%, the refunds can be substantial. The refund procedures are complex. Employers cannot simply amend their employment tax returns and claim a refund." (Miller Johnson)

Press Releases

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