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May 13, 2013          Get Retirement News  |  Advertise
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Employee Benefits Jobs

Benefits Underwriting Analyst
for Northwestern Benefit Corporation of Georgia in GA

Benefits Manager
for Chemeketa Community College in OR

Client Service Representative
for Associated Pension Consultants in CA

Sales and Marketing Consultant
for FACTS, Inc. in IN

Vice President, Sales
for Prudential in NY

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Webcasts and Conferences

Capital Forum on Pensions
June 19, 2013
(Western Pension & Benefits Council - Sacramento Chapter) in CA

NYU 66th Annual Conference on Labor: Regulation of Compensation
June 6, 2013
(New York University School of Law) in NY

401(k) Rekon is coming to Sacramento, CA
May 15, 2013
(401(k) Rekon) in CA

Chicago Regional
May 13, 2013
(Women in Pensions Network) in IL

Voluntary Fiduciary Correction Program Workshop
May 30, 2013
(U.S. Department of Labor, Employee Benefits Security Administration (EBSA)) in CA

The Future of Employer-Sponsored Insurance Webinar
May 29, 2013
(National Institute for Health Care Management Foundation) WEBCAST

"Fundamentals of 401(k) and Other Qualified Plans" - a 3-day Seminar, Denver
June 12, 2013
(SunGard Relius) in CO

View All Webcasts and Conferences


[Guidance Overview]

Model 'Notice of Marketplace Coverage Options' Released: October 1 Deadline
"Employers must provide the Notice of Marketplace Coverage to current full-time and part-time employees -- regardless of their enrollment status under existing group plans -- no later than October 1, 2013 ... Thereafter employers must provide the Notice to each new employee upon hire, which the Guidance defines as within 14 days of an employee's start date. Employers wanting to provide the Notice to current employees and new hires in advance of the October 1, 2013 deadline may use the Model Notices and rely on the terms of the Technical Release in doing so." (E is for ERISA)


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[Guidance Overview]

DOL Issues Model Exchange Notices, Updated COBRA Election Notice and Related Guidance
"The notice [for employers who offer a health plan] includes spaces in which basic information about an employer is provided, and includes questions about the employer's coverage, including whether: The coverage is offered to all or some employees and, if the latter, which employees are eligible. Dependent coverage is provided. The coverage meets minimum value and is intended to be affordable, based on employee wages." (Practical Law Company)

[Guidance Overview]

Protecting Health Information Should Be a Top Compliance Priority
"This is a new requirement for many businesses, which now have HIPAA compliance obligations. HIPAA's expansion to include downstream subcontractors may be an unknown regulatory disaster for many who are completely unaware of their newfound obligations to safeguard health information privacy. And, they are at considerable financial risk if they don't." (Vorys, Sater, Seymour and Pease LLP)

[Guidance Overview]

The Legal Risks Behind Workplace Wellness Programs (PDF)
"Before implementing a wellness program, employers must consider the requirements of the Health Insurance Portability and Accountability Act ... the Americans With Disabilities Act ... the Genetic Information Non-Discrimination Act ... and state law. Unfortunately, this is a relatively complex area of the law in which more detailed guidance is greatly needed from administrative agencies and the courts." (Locke Lord)

Questions to Ask Yourself About Your Wellness Program
"A huge amount of health spending is simply not preventable in the usual ways. In order to evaluate the effectiveness of your wellness program, i.e., its potential to save real dollars, here are a list of [twelve] questions you should ask yourself: [1] Much of the money we spend on health care is for older workers. Does your wellness program prevent aging? [2] A huge share of your plan dollars go for employees who are simply misdiagnosed, as much as 8-16%. Does your wellness program prevent misdiagnoses?" (Cracking Health Costs)

EEOC Taking Closer Look at Employer Wellness Programs
"The EEOC's meeting appears to indicate the Commission will examine carefully rules governing wellness programs.... Employers have been hoping for some time that the EEOC would clarify its position under the ADA on when a wellness program is voluntary. Even if the EEOC does this, wellness programs still may face resistance from advocacy groups looking to challenge these programs under other EEO laws." (Jackson Lewis LLP)

EEOC Hears Call for Guidance on Employer Wellness Programs During Public Meeting
"Panelists testified that the EEOC must provide clarity on a number of key issues, including the nature of employers' incentives for employees to participate in wellness programs and subjecting employees to disability-related questions or medical examinations in connection with these programs." (Sidley Austin LLP)

[Guidance Overview]

The Obamacare 'Play or Pay' Rules: A Practical Approach
"[B]ecause the 50-employee limit is based on full-time equivalents, all the hours of all employees (including part-time employees) are considered ... One strategy to avoid triggering penalties under health care reform is ... to stay below 30 full-time employees. The business can then use part-time employees or contingent employees if needed to expand. With only 30 full-time employees, even if the hours of part-time employees result in the employer crossing the 50 FTE limit, this strategy allows the employer to avoid both types of penalties." (Davis Wright Tremaine LLP)

The Massachusetts Experience: Employer-Sponsored Health Insurance Post-Reform (PDF)
"In the seven years since Massachusetts enacted its law, the number of people covered by insurance through the workplace increased by about 1 percentage point, running counter to the rest of the nation, which saw employer-based insurance decline by 5.7 percentage points. Coverage in Massachusetts increased even among the smallest businesses, which were exempt from any requirement to provide coverage, and came in the midst of a recession. Interviews with executives in the state indicate a growing number of individuals sought employer-based coverage in an effort to comply with the new requirement to be insured." (PricewaterhouseCoopers)

A Self-Funded Employer's Worst Nightmare
"The employer changed to a self-funded plan and purchased stop-loss that provided coverage for member claims that exceeded $75,000 up to a $1 million lifetime maximum. The employer thought that the health plan imposed a $1 million lifetime maximum on benefits.... [When the employer found itself responsible for payment of a claim that exceeded that maximum,] the employer argued that the agents had a special relationship with the employer in the design of the plan and the stop-loss coverage.... [T]he court refused to dismiss that claim. Thus, the employer will have the opportunity to show the court that there was a fiduciary relationship between the insurance agents and the employer and that the insurance agents should cover the losses not covered by the stop-loss insurance." (Leonard, Street and Deinard)

Treasury and IRS Update from ABA Joint Committee on Employee Benefits
"One of the issues [discussed with IRS at a recent meeting] was whether employers can use a 'non-safe harbor approach' for some of its employees, but a safe harbor approach for other employees for purposes of the employer penalty rules.... Another issue ... was whether HRAs and individual policies can still be integrated ... Many potential arrangements are being marketed to employers that do not take into account the 4980H rules[.]" (Kilpatrick Townsend)

Budget Request Denied, Sebelius Turns to Health Executives to Finance Obamacare
"[HHS Secretary Kathleen] Sebelius has ... made multiple phone calls to health industry executives, community organizations and church groups and directly asked that they contribute to non-profits that are working to enroll uninsured Americans and increase awareness of the law ... The [ACA] included $1 billion to be used in overall implementation of the law. [CBO] projections, however, estimated that federal agencies would need between $5 billion to $10 billion to get the law up and running over the next decade. And as many states have refused to partner with the federal government in setting up the law, the burden on HHS has grown." (The Washington Post)

Which Workers Are Most at Risk of Reduced Work Hours Under the ACA? (PDF)
"This data brief looks at which industries have a high percentage of employees working fewer than or slightly above 30 hours, placing them at risk for reduced hours by an employer wishing to avoid penalties. [It] also look[s] at the distribution of hours worked by type of health coverage.... The 2.3 million workers identified as at greatest risk for work hour reduction represent 1.8 percent of the United States workforce." (UC Berkeley Labor Center)

Shifting Seniors to Private Plans Already Has Cost Medicare $282.6 Billion
"Medicare adopted a risk-adjustment scheme in 2004, but this has not curbed private plans' ability to game the payment system. This has added $122.5 billion to Medicare's costs since 2004.... In total ... Medicare has overpaid private insurers by $282.6 billion since 1985. Risk adjustment does not work in for-profit MA plans, which have a financial incentive, the data, and the ingenuity to game whatever system Medicare devises." (Physicians for a National Health Program)

Obamacare Confusion Triggering Potential Scams
"Specifically in Ohio, scammers are: [1] Claiming to be authorized to help people navigate the health insurance exchange created under the ACA and say they need to verify the person's name, address and Social Security number. Tip: Health insurance exchange open enrollment does not begin until Oct. 1. The marketing of plans offering coverage through the exchange has not begun. [2] Claiming to be a Medicare representative and that because of the ACA the person's information needs verified in order to receive a new Medicare card. Tip: New Medicare cards are not being issued because of the federal health care law. [3] Claiming they need the person's Medicare number to provide them an updated medical emergency alert device. One of the brand names mentioned was Lifeline. Tip: Medicare does not cover medical alert devices." (Ohio Department of Insurance)

Obama: 'The Law Is Here To Stay'
Excerpt from speech by President Obama: "[T]here are two main things that the American people need to know about this law and what it means. First, if you're one of the nearly 85 percent of Americans who already have health insurance -- whether it's through your employer, or Medicare or Medicaid -- you don't have to do a thing.... [I]f you're one of the tens of millions who don't have health insurance, beginning this fall, you'll finally be able to compare and buy quality, affordable private plans that work for you." (Kaiser Health News)

Competition Spurs Oregon Insurers to Lower Proposed Rates
"As soon as Oregon this week became the fourth state to publicly list health insurers' proposed 2014 rates for individual and small group coverage ... Providence Health Plan and Family Care Health Plans sought to lower their rates when they noticed they were out of whack compared to competitors -- five months before the health law's new online marketplaces even open for enrollment. What is also clear from the filings is that there's little sign in Oregon of the major premium hikes that the industry has been warning about for months." (Kaiser Health News)

GAO Reports that Alternative Measures Could Be Used to Allocate Medicaid Funding More Equitably
"GAO's analysis shows that measures of the demand for services, geographic cost differences, and state resources can be combined in various ways to provide a basis for allocating Medicaid funds more equitably among states." (U.S. Government Accountability Office)

Third Circuit Allows Penalties for Failure to Provide COBRA Notice Even Through Coverage Continued After Employment Terminated
"The court rejected the employer's claim that COBRA notices are not required when an employee resigns if the employee continues to have health coverage. The court explained that the clock starts running for required COBRA notices beginning when the first event occurs that causes, or will cause, the employee to lose coverage, even if the coverage does not terminate until a later time. Consequently, the court held that plan administrators are not relieved of the obligation to provide COBRA notices merely because employees are still covered under the employer's health plan after termination." [Fama v. Design Assistance Corp., Nos. 12-2414, 12-2474 (3rd Cir. Apr. 10, 2013)] (Buchanan Ingersoll & Rooney PC)

Plan Administrator Abused Discretion in Denying Coverage for Air Ambulance
"The court faulted the plan administrator for disregarding the physicians' opinions and failing to provide a logical explanation for denying benefits. Concluding that the plan administrator had abused its discretion, the court ruled for the participant.... One wonders whether the plan administrator might have prevailed had it invested a little more effort to document its interpretation of the plan language and distinguish the opinions of the participant's physicians." [Couture v. Gen. Motors, LLC, 2013 WL 1693598 (D. Ariz. 2013)] (Thomson Reuters / EBIA)

Employer Agrees to $1.3M Settlement in COBRA Class Action Over ARRA Notices
"The employees -- who were terminated when the employer temporarily and unexpectedly closed due to legal difficulties -- alleged that the employer failed to provide COBRA election notices that informed them of their rights to subsidized COBRA coverage under the American Recovery and Reinvestment Act (ARRA). They also alleged that the employer withheld health insurance premiums from their final paychecks and breached their fiduciary duties by failing to remit the premiums to the insurance carrier." [Hornsby v. Macon County Greyhound Park, Inc., 2013 WL 1747539 (M.D. Ala. 2013)] (Thomson Reuters / EBIA)

IRS Sets 2013 Maximums for Valuing an Employer-Provided Vehicle's Personal Use
"Employees who use a company car for commuting or other personal uses that are more than de minimis will realize income on the value of their personal use. That value may be determined using a general valuation rule or one of three special valuation rules: the automobile annual lease valuation rule, the cents-per-mile rule, or the commuting valuation rule.... Although the cents-per-mile rule seems simple, it is often unavailable due to its strict conditions, including the requirement that the vehicle's fair market value not exceed IRS limits." (Thomson Reuters / EBIA)


The Folly of Regulating Employer Wellness Policies
"Somewhat lost in the back and forth between business lobbyists and the Obama administration, though, is a bigger question: Why should the federal government be regulating these sorts of wellness policies at all? If businesses want to provide health and wellness incentives to employees, that should be something that employers and their employees negotiate between themselves, just like other benefits and wages. It is, ultimately, a compensation issue." (Reason.com)


An Overdue Vote on Flexibility Under the FLSA
"[A]mending the FLSA and giving the public sector more flexibility made sense for both public employers and public employees, and it has worked effectively ever since. Now, decades later, Congress may finally take action to extend similar flexibility to the private sector. It's long overdue." (Human Resource Executive Online)


Sen. Alexander Says Sebelius's Fundraising and Coordinating with Private Entities to Implement Health Care Law 'May Be Illegal'
"Secretary Sebelius's fundraising for and coordinating with private entities helping to implement the new health care law may be illegal, should cease immediately and should be fully investigated by Congress. Such private fundraising circumvents the constitutional requirement that only Congress may appropriate funds. If the secretary or others in her department are closely coordinating the activities of Enroll America, which is headed by a former White House aide, then those actions may be in violation of the Anti-Deficiency Act." (Committee on Health, Education, Labor and Pensions, U.S. Senate)


Tobacco Rating of Insurance Costs: Issues for Consumers (PDF)
"Under the [ACA], insurers can charge tobacco users higher premiums for health coverage, a practice known as tobacco rating. Tobacco rating could make health coverage unaffordable for many Americans. Tobacco rating will not help tobacco users quit. Tobacco rating will disproportionately harm certain populations." (Families USA)


Text of Business Roundtable Letter to President Obama on Proposed Wellness Rule
"[Business Roundtable is] very concerned that [standards in the proposed regulation] could lead to these programs being required to develop numerous, individualized means for participants to obtain the program's reward if they fall short of meeting the program's goal. As a result, this requirement would unnecessarily and excessively restrict the ability of wellness programs to actually encourage, much less engender, healthier behavior by some participants." (Business Roundtable)

Benefits in General; Executive Compensation

[Guidance Overview]

Last Call for Changes to Compensation Committee Charters
"Every Compensation Committee Chair with whom [the author has] spoken has indicated that he/she always believed -- even before Dodd-Frank -- that the Committee had the authority to retain its own counsel and consultants. However, the stock exchange rules require that the Charter explicitly give the Committee the duty and power to review the independence of its advisers, in writing." (Winston & Strawn LLP)

ERISA Does Not Preempt Post-Distribution Suit Against Beneficiaries
"Despite [waiving any benefits from the Plans, [his ex-spouse] never named a new beneficiary for either Plan. Accordingly, the administrator of the Plans determined that the proceeds of both Plans should be paid to Andochick, because Andochick remained the named beneficiary of the Plans.... Andochick argued that ERISA preempts the waivers embodied in the marital settlement agreement. The Fourth Circuit disagreed, finding that '[a]llowing post-distribution suits to enforce state-law waivers does nothing to interfere' with the core objectives of ERISA. Therefore, the Fourth Circuit determined that Andochick should be paid the benefits from the Plans, but that the decedent's estate could seek to recoup those benefit by enforcing the marital settlement agreement in state court.'" (Herrick, Feinstein LLP)

Nonresident Employee Avoids New York Taxes on Deferred Compensation Payment
"New York is known as a state that aggressively pursues and taxes nonqualified deferred compensation earned by nonresidents while working in New York. This advisory opinion favors the taxpayer by not asserting New York taxation in a situation in which unforeseeable circumstances resulted in a change in the method of payment." (Leonard, Street and Deinard)

Sixth Circuit Finds ERISA Does Not Preempt State Law Claims Surrounding 'Invalidation' of Plan by Company Board of Directors (PDF)
"Defendants' duty not to interfere with Plaintiffs' SERP agreement with Metaldyne arises under Michigan tort law, not the terms of the SERP itself. And more to the point ... Defendants' duty is not derived from, or conditioned upon, the terms of the SERP. Nobody needs to interpret the plan to determine whether that duty exists. Thus, Plaintiffs' claim is based upon a duty that is 'independent of ERISA [and] the plan terms[.]'" [Gardner v. Heartland Indus. Partners, LP, No. 11-2327 (6th Cir. May 10, 2013)] (U.S. Court of Appeals for the Sixth Circuit)

Press Releases

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