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BenefitsLink Health & Welfare Plans Newsletter

January 8, 2013          Get Retirement News  |  Advertise  |  Unsubscribe
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Employee Benefits Jobs

Account Manager, Retirement Services
for Lockton Insurance Brokers, LLC - Recognized by Best Insurance as a Best Place To Work in Insurance - 2010, 2011, 2012 in CA

Advisory Services Administrator
for Alerus Financial in MI

Advisory Services Operations Manager
for Alerus Financial in MI

VP Compliance/Operations
for ADP in NJ

Pension Administrator
for Retirement Strategies, Inc. in GA

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Webcasts and Conferences

Health & Welfare Plans Legislative Update
Nationwide on January 31, 2013 presented by TRI-AD

Retirement Plans Legislative Update
Nationwide on March 21, 2013 presented by TRI-AD

Retirement Plan Compliance Assistance Seminar
in California on March 7, 2013 presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

View All Webcasts and Conferences

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[Guidance Overview]

Temporary Reinsurance Program: Sticker Shock for Employers
"The fee applies to a plan that provides major medical coverage. As a result, there are several types of health coverage which are not subject to the fee: [1] Stand alone vision and dental plans; [2] Stand alone prescription drug plans; [3] HSAs; [4] HRAs that are integrated with a group health plan; [5] Medical flexible spending accounts (even if not an excepted benefit); [6] Most employee assistance plans, disease management programs and wellness programs (if they do not provide major medical coverage); [7] Hospital indemnity coverage; [8] Stop loss insurance[.] There is no exception to the fee for retiree only major medical plans." (Miller Johnson)


FMLA in Real Life January 10, 2013 Webcast

Sponsored by IFEBP (International Foundation of Employee Benefit Plans)

It's one thing to be familiar with FMLA, but what does compliance look like in the real world? This International Foundation Webcast will explain how to deal with the challenging and complex FMLA issues you face each day. Register Now!

[Guidance Overview]

New Regulations Will Allow Employers to Put More Teeth into Wellness Programs
"[O]ne of the requirements for a wellness program is that the incentive be made available to all similarly-situated individuals. This requirement includes making available a reasonable alternative to qualify for the incentive if it is unreasonably difficult for an individual to satisfy the standard because of a medical condition or if it is medically inadvisable for an individual to attempt to satisfy the standard. The proposed regulations clarify that if the reasonable alternative is the completion of an educational program, the plan must make the educational program available instead of requiring an individual to find such a program on his or her own and may not require the individual to pay for the cost of the program." (Miller Johnson)

[Guidance Overview]

New Regs Require Employer Action in Preparation for 2014 Pay or Play Penalty
"The proposed regulations answer many questions concerning the penalty including the following: What if an employer offers health coverage to some, but not all, of its employees; which penalty applies? ... Is an employer only required to offer health coverage to its employees (and not dependents) in order to avoid the penalty? ... Does the penalty apply on a combined basis in the case of commonly-owned employers?" (Miller Johnson)

[Guidance Overview]

Overview and Practical Implications of Proposed Regs Requiring Employers to Offer Health Coverage or Pay a Penalty (PDF)
"The proposed regulations likely will expand coverage for employees on paid or unpaid leaves of absence, assuming the employer is going to 'play.' First, the proposed regulations equate paid leaves of absence to actual employment, and the preamble provides that this requirement applies regardless of the duration of the paid leave.... Second, if an employer relies on the look-back measurement periods to determine full-time employee status, the employer generally is required to offer coverage that continues for the entire corresponding stability period even if the employee goes on an unpaid leave provided the employee remains employed." (Paul, Hastings, Janofsky & Walker LLP)

[Guidance Overview]

IRS Issues More 'Play or Pay' Guidance
"[R]ather than counting the actual hours worked by salaried employees, an employer may apply a daily or weekly 'equivalency rule.' Under these rules, employees must be credited with 8 hours of service for each day, or 40 hours of service for each week, during which they complete any hours of service. These two equivalencies are slightly lower than the ERISA equivalencies of 9 hours per day or 45 hours per week. On the other hand, the regulations make clear that these daily or weekly equivalency rules may not be used if they would substantially understate an employee's hours of service in a manner that would cause the employee not to be treated as full-time." (Spencer Fane)


COBRA - I Thought the Subsidy Was Over!! -- Audio Conference, January 11

Sponsored by Lorman and BenefitsLink.com

YES, the subsidy is over, but now we are living with the results. Let's look at the impact the subsidy had on COBRA election rates and claim utilization. And, what is the future of COBRA? Will we still have it after 2014? Discounted pricing for BenefitsLink readers.

[Guidance Overview]

IRS Releases Further Guidance on Employer Health Care Coverage Mandate and Penalties
"With a few new twists and clarifications, the proposed regulations ... follow guidance issued in four earlier IRS notices on minimum value and reporting requirements and methods for determining employee status. Highlights include: ... [1] Leased employees, sole proprietors, partners, and 2-percent shareholders in an S corporation are not employees for this purpose. [2] The rules confirm that an employer must offer coverage to an employee's dependents. For these purposes, a 'dependent' is a child younger than age 26." (Ballard Spahr)

[Guidance Overview]

Patient-Centered Outcomes Research Trust Plan Sponsors: Don't Close Your Wallets Yet! (PDF)
"[T]o determine the 'average number of lives' covered under a specified health insurance policy during a policy year, one of the following methods must be used. To meet the consistency requirement, the same method must be used for calculating the average number of lives covered under a policy consistently for the duration of the year." (Chao & Company, Ltd.)

An Employee's Request for Vacation Leave Is Denied, So FMLA Leave Is Used -- What Recourse Does the Employer Have?
"Plenty of employers just mark these days off as FMLA leave. But they often do so with a whole lot of regret and with a wish they could do something more to push back on what they believe is a suspicious leave request. But employers can push back, and here's how... Enforce your rights at the medical certification stage.... Enforce your rights by seeking clarification and/or a second opinion.... Enforce your rights at the recertification stage.... If the abuse is particularly bad, termination may be appropriate (in extreme cases)." (FMLA Insights)

Growth of Health Care Spending Remains at Historic Low
"New statistics from the Centers for Medicare & Medicaid Services show that the overall growth in health spending was at a historic low for the third year in a row. According to the annual Report of National Health Expenditures, total U.S. health spending grew 3.9 percent in 2011. That's the same rate of growth as in 2009 and 2010, and in all three years spending grew more slowly than in any other year in the 51 year history of the report." (HHS Secretary Kathleen Sebelius on HealthCare.gov)

Health Care Spending in 2011 Grew at Half of Pre-Recession Level
"Spending on hospital visits, medications and other care grew 3.9 percent to $2.7 trillion in 2011, matching the slowest growth in 52 years of record keeping, the Centers for Medicare and Medicaid Services said in a report today in the journal Health Affairs. Growth was close to 8 percent before the U.S. entered an 18-month recession in December 2007." (Bloomberg)

Growth of National Health Expenditures, 2011
"In 2011, health care costs grew at the same rate as the growth in the gross domestic product (GDP). Thus the recent severe recession and slow recovery, plus the initial phase of implementation of the Affordable Care Act, have not had a major impact on the growth of health care spending." (Physicians for a National Health Program)

Unusual Respite From Surging Health Care Costs
"The nation's health care tab stood at $2.7 trillion in 2011, the latest year available, said nonpartisan number crunchers with [HHS]. That's 17.9 percent of the economy, which averages out to $8,680 for every man, woman and child, far more than any other economically advanced country spends.... The 3.9 percent increase meant that health care costs grew in line with the overall economy in 2011 instead of surging ahead as they normally have during a recovery. A health care bill that grows at about the same rate as the economy is affordable; one that surges ahead is not." (The New York Times; free registration required)

New Charts on 2011 Health Care Spending
"In addition to premiums, consumers spent $735 out-of-pocket per person on health care ... in 2011 -- 4.6% more than in 2010.... Spending on prescription drugs averaged $773 per person in 2011 -- an increase of just 1% compared to 2.4% growth in 2010." (Health Care Cost Institute)

The $2.7 Trillion Question: Are Health Care Costs Really Slowing?
"For decades, health-care costs have grown faster than the rest of the economy. That has required the federal government to devote an ever-growing chunk of its budget to health insurance programs. That is the simple, central fact behind our long-term budget problem.... But something weird started happening in 2009, something that throws all of our budget debates into question: Health spending growth slowed." (The Washington Post; free registration required)

ML Strategies Health Care Reform Update, January 7, 2013
Weekly update on developments in federal and state health care reform legislation and regulations. Includes summaries of recent announcements and regulatory activity by HHS, CCIIO, IRS and CMS. (Mintz Levin)

Deloitte Health Care Reform Memo, January 7, 2013
"2013 will be the most important year in the U.S. health care industry in modern history thus far. Our nation's fiscal challenges and our industry's bulk are on a collision course. The story line about health care in 2013 will center on five themes: Clarity, Costs, Compliance, Consolidation, and Consumers." (Deloitte Center for Health Solutions)

Over 150 Potentially Low-Value Health Care Practices: An Australian Study
"There is a major effort under way to curb rising health care costs by reducing the use of clinical interventions that offer little or no benefit or that may be harmful in some cases. Few of these interventions, however, have been formally assessed for safety, effectiveness, and cost.... [This study finds that] few services are ineffective or unsafe for all patients; instead, further research must concentrate on identifying the populations most likely to benefit from services and creating policies that minimize their use outside these indications. 'This would allow funding to be reallocated to more beneficial or cost-effective services, thus maximizing health gain,' the researchers conclude." (The Commonwealth Fund)

With 3:1 Age-Band Ratio, Young People May Face 'Rate Shock'
"Forty-two states now have age-rating bands that are 5:1 or more, according to America's Health Insurance Plans. To illustrate the issue with the 3:1 band, the trade group released an infographic Dec. 12 claiming that under a 3:1 band, a 24-year-old who now pays a $1,200 annual premium under a 5:1 band would see his or her premium spike 45% to $1,740 annually, while a 60-year-old who now pays a $6,000 annual premium would see his or her premium drop 13% to $5,220." (AISHealth.com; free registration required)

Age Band Compression Under Health Care Reform
"[Y]oung, single adults aged 21 to 29 and with incomes beginning at about 225 percent of the [Federal Poverty Level, or 'FPL'], or roughly $25,000, can expect to see higher premiums than would be the case absent the ACA, even after accounting for the presence of the premium assistance.... [S]ingle adults up to age 44 with incomes beginning above approximately 300 percent of FPL can expect to see higher premiums, even after accounting for premium assistance."" (American Academy of Actuaries)

Impact of Obamacare on Business: Lessons from France
"French companies employing 50 or more workers are, among other things, obligated 'to establish a committee on health, safety and working conditions and train its members,' whereas companies with 49 employees are not ... [A chart] shows the number of employers of various sizes ... [T]here are sharply fewer employers (by more than a factor of two) with exactly 50 employees than with exactly 49 employees. Second, although the number of companies usually falls with the number of employees, there are actually more employers with 49 employees than with 45 employees." (John Goodman's Health Policy Blog)


2013: The Year We Become the Health Care Nation
"Without changes, health care alone will consume more of the federal budget than all discretionary spending does now -- defense, law enforcement, courts, and all regulatory agencies.... If you think workers will be surprised when their coverage disappears, just wait until they discover they'll be violating federal law if they don't buy health insurance on their own. Employers who've raised this issue with employees report that many of them, especially lower-paid ones, are simply incredulous." (Fortune)

Benefits in General; Executive Compensation

[Guidance Overview]

Year-End Tax Bill Provides Extensions and Expansions of Various Employee Benefits
"Because the $125 monthly exclusion was not changed until 2013, employers had to withhold income tax and FICA taxes on monthly mass-transit and vanpool benefits greater than $125 that were provided during 2012. The retroactive increase in the exclusion for these benefits for 2012 will be reflected on 2012 Form W-2s and affected employees will recover any extra withholding on their 2012 tax returns." (McGuire Woods LLP)

[Guidance Overview]

Revised New York Regulations Limit Use of State Funds for Executive Compensation by Service Providers as of April 1
"The regulations prohibit the use of more than $199,000 of state funds or state-authorized payments to compensate a 'covered executive' ... [which includes] directors, trustees, managing partners, officers and key employees, all as defined in Form 990 instructions ... whose compensation in whole or in part is an administrative expense.... [I]ndividuals such as department chairs and chief medical officers are not 'covered executives' if they fulfill administrative functions that comprise program services." (Proskauer Rose LLP)

[Guidance Overview]

Effects of the Fiscal Cliff Legislation on Stock Compensation
"[T]he American Taxpayer Relief Act does not have any that directly relate to stock compensation -- though, of course, increases in the rates on income tax, capital gains, and dividends indirectly affect the value of equity awards. [But] changes in tax rates under the new legislation apply to income from stock option exercises, restricted stock and RSU vesting, ESPP purchases, sales of stock, and dividends." (myStockOptions.com)

Press Releases

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