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January 7, 2013          Get Retirement News  |  Advertise  |  Unsubscribe
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Employee Benefits Jobs

Sr. Plan Administrator
for American National Insurance Company in TX

Senior Level Retirement Plan Compliance Consultant/TPA
for Locally owned and nonproducing Compliance Consulting/TPA Firm in OK

Internal Wholesaler
for CPEhr in CA

Actuarial Specialist
for Kravitz, Inc. in CA

Defined Contribution Micro Manager
for The Angell Pension Group, Inc. in ANY STATE

Defined Contribution Manager
for The Angell Pension Group, Inc. in ANY STATE

Analyst, Plan Design & Assessment
for Tyco in NJ

Sr. 401(k) Recordkeeper
for Ingham Retirement Group in FL

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[Guidance Overview]

IRS Issues Proposed Regs on ACA Play or Pay Requirements
"[T]he proposed rule uses the common law standard to define an employee. The IRS notes that, under the common law standard, an employment relationship exists when the person for whom the services are performed has the right to control and direct the individual who performs the services not only as to the result to be accomplished by the work, but also as to the details and means by which that result is accomplished. The IRS rejected suggestions to use an alternative standard for determining employee status.... For purposes of determining whether an employer meets the 50 full-time employee (or full-time employees and FTEs) threshold, an employer generally must take into account only work performed in the United States." (Littler Mendelson P.C.)


Nat'l Health Benefits Conf & Expo (HBCE) Jan.29-30, 2013 -- Clearwater Beach, FL

Sponsored by Health Benefits Conference & Expo (HBCE)

Speakers wrote the books on wellness, onsite clinics, disease management, obesity and health reform. Hear from public employers, universities, Boeing, FirstEnergy, JetBlue, Mayo Clinic, many more. Low cost, high quality! HBCE.com Ph: 941-484-1430 info@HBCE.com

[Guidance Overview]

How Will the Employer Penalty in 2014 Work? (PDF)
"[S]ome of the significant changes, modifications, clarifications, and transition relief provided in the proposed regulations: [1] 'Large employer' determined using IRS aggregation rules, but penalty assessed on an employer-by-employer basis.... [2] Requirement to offer coverage to all full-time employees.... [3] Dependent coverage defined.... [4] Measurement/stability period variations based on classification.... [5] Paid leave counts for purposes of determining 'full-time' status.... [6] Counting hours worked by foreign employees.... [7] Safe harbors for determining affordability." (Seyfarth Shaw LLP)

[Guidance Overview]

IRS Issues Employer 'Shared Responsibility' Proposed Regs
"[The regulations]: [1] Expand upon earlier IRS safe harbor guidance for determining whether an employee is full-time and for determining whether coverage is affordable. [2] Clarify that an employer will not be subject to tax for failure to offer coverage to spouses. [3] Clarify that an employer that offers coverage to all but 5% of its full-time employees (or, if greater, 5 full-time employees) and their dependents will be considered to have offered coverage to 'substantially all' full-time employees. [4] Clarify that each single employer within a controlled group of employers will be separately liable for the tax. [5] Provide that employers will be notified that an employee has received a premium tax credit or a cost-sharing reduction for coverage on an Exchange and will have an opportunity to respond before the IRS issues a notice and demand for payment." (Groom Law Group)

[Guidance Overview]

Overview of Recent Guidance on Taxes and Fees under the ACA
"Group health plan sponsors will need to be particularly mindful of the need to report data for and pay the transitional reinsurance contribution fees late in 2014 (or early in 2015). The new rules address various details ... [including] certain transitional rules for 2014 and guidance on how the programs will coordinate with each other and with the medical loss ratio (MLR) requirements for insurers. The new rules also address a number of matters relating specifically to the MLR requirements and to state and federally operated insurance exchanges." (Ballard Spahr)

[Guidance Overview]

Risk Transfer Programs Under ACA: Reinsurance, Risk Corridor and Risk Adjustment (PDF)
"A not-for-profit reinsurance fund will be established where all health insurance issuers and third party administrators, on behalf of self-insured group health plans, must make contributions to support reinsurance payments to individual market issuers that cover high-cost individuals in the Exchange. Reinsurance payments are expected to total $10 billion in 2014, $6 billion in 2015, and $4 billion in 2016. The reinsurance fund will pay back carriers for some portion of the claims costs above a certain level (attachment point) and up to a limit (cap)." (Chao & Company, Ltd.)

[Guidance Overview]

The Transitional Reinsurance Program -- Plan Sponsors: Time to Pay More! (PDF)
"[HHS] proposes that each contributing entity is required to report an annual enrollment count of the average number of covered lives by November 15th of each benefit year. Within 15 days of submission of the annual enrollment count or by December 15th, whichever is later, HHS will notify each contributing entity of the reinsurance contribution amounts to be paid based on that annual enrollment count. A contributing entity remits contributions to HHS within 30 days after the date of the notification of contributions due for the applicable benefit year." (Chao & Company, Ltd.)

[Guidance Overview]

IRS Proposed Rules on Employer Mandate Include Transition Relief for Cafeteria Plan Elections
"Under the proposed regulations, an applicable large employer may choose to amend its cafeteria plan to permit either (or both) of the following changes in salary reduction elections, which apply regardless of whether employees experience a change of status event under the cafeteria plan regulations: [1] An employee who made a salary reduction election through his employer's cafeteria plan for health plan coverage with a fiscal year beginning in 2013 can prospectively revoke or change his election regarding the plan during that plan year. [2] An employee who did not make a salary reduction election under his employer's cafeteria plan for health plan coverage with a fiscal deadline beginning in 2013 (before the applicable deadline under the cafeteria plan regulations) can make a prospective salary reduction for coverage on or after the first day of the cafeteria plan's 2013 plan year." (Practical Law Company)

Five Facts About Obamacare and Health Premiums
"1. The average American family pays $15,022 a year in health insurance premiums.... 2. Insurance premium growth has wiped out the last decade of wage growth.... 3. The Affordable Care Act has contributed to the rise in premiums, especially in the individual market.... 4. The Affordable Care Act has returned more than $1 billion in premiums to consumers in the form of insurance rebates.... 5. Regulators rejected or lowered at least 924 insurer rate hikes in 2010." (The Washington Post; free registration required)

Despite New Health Law, Some See Sharp Rise in Premiums
"Health insurance companies across the country are seeking and winning double-digit increases in premiums for some customers, even though one of the biggest objectives of the Obama administration's health care law was to stem the rapid rise in insurance costs for consumers. Particularly vulnerable to the high rates are small businesses and people who do not have employer-provided insurance and must buy it on their own." (The New York Times; free registration required)

Developments of Interest to Sponsors of Multiemployer Health Plans, January 2013 (PDF)
Articles include: ACA Compliance News; What Multiemployer Health Funds are Doing to Manage Costs: Selected Strategies; Health Plan Cost Trends. (The Segal Group, Inc.)

Citing Conflict of Interest, Seventh Circuit Rules Plan Administrator Abused Discretion in Discontinuing Disability Benefit
"The Seventh Circuit agreed with the trial court that the insurer's determination that the participant was not disabled was improperly motivated by its own financial interest.... In particular, the court was unconvinced by the insurer's explanation of how it determined that the participant was not disabled, while the Social Security Administration found that he was. The insurer asserted that the plan's definition of disability differed from the SSA definition, but the court found they were "functionally equivalent" and that slight wording differences did not explain a different outcome." [Raybourne v. CIGNA Life Ins. Co. of N.Y., 2012 WL 5870713 (7th Cir. 2012)] (Thomson Reuters / EBIA)

ERISA Does Not Preempt Vermont Law Requiring Submission of Health Claims Data
"The court here noted that Second Circuit cases ... have looked to whether a state law requires particular benefit structures or administration, or provides alternative enforcement mechanisms -- neither of which the Vermont law does. Absent these factors, Supreme Court decisions generally support a presumption against ERISA preemption in the field of health care, a subject of traditional state regulation. The court reasoned that Vermont's law operated within this traditional realm of regulation by seeking data to improve the administration of health care services, and any indirect effect on ERISA plans was too peripheral to overcome the presumption because the law did not affect core ERISA relationships (among participants, beneficiaries, administrators, and employers) or functions (such as processing claims and disbursing benefits)." [[Liberty Mut. Ins. Co. v. Kimbell, 2012 WL 5471225 (D. Vt. 2012)]] (Thomson Reuters / EBIA)

Private Health Care: The Lessons from Sweden
"Thanks in part to the outsourcing of the state, Sweden's private equity industry has grown into the largest in Europe relative to the size of its economy ... The key to this takeover was allowing private firms to enter the healthcare market, introducing competition into what had been one of the world's most 'socialised' medical systems." (The Guardian)

It's a Mad, Mad, Mad, Mad Obamacare
"[F]or the better part of a year states and groups like the bipartisan National Governors Association and the National Association of Medicaid Directors have been begging HHS merely for information about how they're required to make ObamaCare work in practice.... Now post-election, new regulations are pouring out from HHS -- more than 13,000 pages so far and yet nuts-and-bolts questions are still unanswered. Most of what we know so far comes from a 17-page question-and-answer document that HHS divulged this week, though none of the answers have the force of law and HHS says they're subject to change at any moment." (The Wall Street Journal)


Physician Groups Say ACA Drug Benefits Can Be Strengthened
"Organized medicine groups said a proposed federal rule defining benefits requirements under the health system reform law might not provide sufficient prescription drug coverage for patients with chronic conditions. The associations suggested that Medicare's drug benefit, which contains some additional patient protections and has a broader list of covered medications, should serve as a model for formularies offered by insurance plans under the law." (American Medical Association)


Text of Comments to HHS on Proposed Health Insurance Market Rules and Rate Reviews (PDF)
"While subsidies and higher cost-sharing options may be of some assistance, in most states, these populations could have their individual market rates rise considerably in 2014. This potential "rate shock" could, in turn, result in their leaving the marketplace, even with the penalties, which are quite low in the first years. States need as much flexibility as possible under the law to work with issuers to address this problem." (National Association of Insurance Commissioners)


Do the Wellness Math Yourselves, CFOs
"[T]he average Fortune 500 company pays unhealthy workers $460 per year to act like healthy workers. That is the value of incentives employees at such companies got for participating in wellness programs in 2011, according to a [recent] study ... Oh, and the already-healthy workers got the incentives, too. And the $460 figure didn't even include the programs' costs.... [U]nfortunately, the investment does not reduce health-care spending at all[.]" (CFO)


Economist Uwe Reinhardt Explains Complexities in Pricing of Medicare Advantage Plans
"A fundamental question that has engaged health-policy researchers and commentators for some time is whether coverage of Medicare's standard benefit package under Medicare Advantage plans is cheaper or more expensive than it is under traditional fee-for-service Medicare. The answer is yes." (Physicians for a National Health Program)

Benefits in General; Executive Compensation

[Guidance Overview]

2012 Q&As: DOL Meeting with ABA Joint Committee on Employee Benefits, May 9, 2012 (PDF) (PDF)
32 pages. Topics addressed include 403(b) Distributions; Deferred Annuities in Defined Contribution Plans; Medicare; Electronic Delivery; Health Savings Accounts; and Participant Investment Directions. "The responses reflect only unofficial, nonbinding staff views as of the time of the discussion, and do not necessarily represent the official position of the DOL. Further, this report on the discussions was prepared by JCEB representatives, based on their notes and recollections of the meeting." (Joint Committee on Employee Benefits, American Bar Association)

[Guidance Overview]

Fiscal Cliff Bill Affects IRAs, Roth 401(k)s, Coverdell ESAs (PDF)
"This legislation revives a number of expired or expiring tax provisions, and seeks ways to generate federal tax revenues through new taxpayer incentives.... IRA Qualified Charitable Distributions Extended, Transition Period Allowed ... In-Plan Roth Rollovers Expanded ... Permanence for Coverdell ESA Account Provisions ..." (Ascensus)

Best Practices and Proxy Firm Policies Take Center Stage for 2013 Executive Compensation
"Pay for performance will be the name of the game in the 2013 proxy season, with many companies expected to provide alternate pay for performance disclosures, and both proxy advisory firms have incorporated alternate disclosures into their analysis.... Dodd-Frank comp regulations await key personnel changes at deadlocked SEC ... New leadership in key congressional committees may signal greater willingness to explore Dodd-Frank changes." (HR Policy Association)

A Soft Landing from the Fiscal Cliff for Employee Benefits
"This legislation significantly expands the ability for participants to convert non-Roth accounts within 401(k), 403(b), and 457(b) governmental plans to Roth accounts without withdrawing amounts from the plan. This provision is expected to raise 12.2 billion over 10 years to offset the loss of revenue stemming from the sequestration delay. The Fiscal Cliff legislation also addressed the tax exclusions for employer-provided educational and adoption assistance, which were both scheduled to expire at the end of 2012, re-established the parity between mass transit and parking fringe benefits that expired at the end of 2011, and addressed dependent care assistance benefits." (Ogletree Deakins)


Health and Retirement Priorities for the 113th Congress: U.S Chamber of Commerce Looks at Year in Review and Year Ahead (PDF)
"Although the Chamber is committed to reforming the nation's health care system to lower costs, improve quality and access, and build a more value-driven system, the Patient Protection and Affordable Care Act (PPACA) does not accomplish these goals.... The Chamber supports repealing the employer mandate to not only protect existing jobs, but to spur the creation of new jobs by removing much of the fear and uncertainty employers are experiencing.... The Chamber intends to work with Congress and other interested parties in finding solutions to longterm funding issues in the multiemployer pension plan system.... The Chamber believes that raising the PBGC premiums, without making comprehensive reforms to the PBGC or the defined benefit system, amounts to a tax on employers that have voluntarily decided to maintain defined benefit plans." (U.S. Chamber of Commerce)

Press Releases

Implement a Legal Plan in Three Easy Steps
Hyatt Legal Plans, a MetLife company

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