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BenefitsLink Health & Welfare Plans Newsletter

June 6, 2013          Get Retirement News  |  Advertise
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Employee Benefits Jobs

Strategic Communications Consultant - Team Lead
for New York Life Retirement Plan Services in MA

Benefits & Compensation Manager
for Mayville Engineering Co., Inc. in WI

Employee Benefits Consultant/Attorney
for Aon Hewitt in IL

Sales Associate
for Retirement, LLC & Jennings Law Firm, Ltd. in IL

Director, Structured Settlement Market & Product Development & Management
for Prudential in NJ

ERISA Consultant I
for Ascensus in MN

Defined Contribution Consultant
for The Benefit Practice in FL

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Webcasts and Conferences

Results of Mercer's 2013 US Pension Risk Survey with CFO Magazine Webcast
June 25, 2013 WEBCAST

"Strengthening the Multiemployer Pension System: What Reforms Should Policymakers Consider?" Hearing
June 12, 2013 in DC
(Committee on Education and the Workforce)

Health and Welfare Update and Planning for 2014 Teleconference
June 19, 2013 WEBCAST
(Kilpatrick Townsend & Stockton LLP)

2013 ERISA Update Seminar
November 20, 2013 in Hawaii
(TRI Pension Services)

View All Webcasts and Conferences


[Official Guidance]

Instructions to IRS Form 720: Payment of Patient-Centered Outcomes Research Fee (PDF)
April 2013 revision date. Excerpt: "The Affordable Care Act ... imposes fees on issuers of specified health insurance policies (section 4375) and plan sponsors of applicable self-insured health plans (section 4376) to help fund the Patient-Centered Outcomes Research Institute. The fees, required to be reported annually on the 2nd quarter Form 720 and paid by its due date, July 31st, are based on the average number of lives covered under the policy or plan. The fees apply to policy or plan years ending on or after October 1, 2012, and before October 1, 2019. (Internal Revenue Service)


Achieve a New Level of Professional Growth With CEBS!

Sponsored by IFEBP (International Foundation of Employee Benefit Plans)

As the most respected designation in the industry, Certified Employee Benefit Specialist (CEBS) courses give you the knowledge and confidence to succeed in today's business environment. Learn More!

[Official Guidance]

IRS Form 720: Payment of Patient-Centered Outcomes Research Fee (PDF)
Just released. Marked as having a revision date of April 2013. (Internal Revenue Service)

[Official Guidance]

CMS Draft of Employer Application for Small Business Health Options Program (SHOP) Health Coverage (PDF)
"The SHOP Health Insurance Marketplace offers a new way for small employers to offer health insurance to employees. The SHOP is open to all small business owners. It should take about 15 minutes to complete this application for eligibility." (Centers for Medicare & Medicaid Services)

[Official Guidance]

CMS Draft of Employee Application for Small Business Health Options Program (SHOP) Health Coverage (PDF)
"Use this application to see if you're eligible to get SHOP health coverage from your employer. It should take about 10 minutes to complete this application." (Centers for Medicare & Medicaid Services)

[Guidance Overview]

IRS Form 720 for Remittance of PCORI Fees Is Available Now; July 31 Deadline for Some Plans
"Although the Form 720 is designed for quarterly payments of certain excise taxes, the PCORI fee is paid only annually.... [T]he first round of PCORI fees are due for 2012 calendar year self-insured plans and certain fiscal year plans by July 31, 2013.... [P]lan sponsors of self-insured health plans must act soon to make arrangements to complete and file the Form and pay the annual PCORI fees to the IRS, as the PCORI regulations directly prohibit using 'third-party reporting' arrangements with respect to the Form 720. Plan sponsors are also advised that the fee must be paid by the plan sponsor and generally cannot be paid by the plan or from plan assets." (BakerHostetler)


Defined Contribution Healthcare & Private Exchanges Summit

Sponsored by Healthcare Education Associates

Join us for this exceptional opportunity to share ideas and network with leaders from 4 and 5-star plans, quality consultants and healthcare executives July 29-30 in Westlake Village, CA. Mention HMP164 for 10% discount.

Large Educational/Health System Targeted for HIPAA Enforcement
"[C]overed entities might want to review the terms of the fairly onerous CAP signed by [Idaho State University].... These onerous provisions on continuing operations keeps OCR in an oversight capacity that could be difficult for administrators and IT professionals to manage.... OCR is lifting the veil on internal disciplinary actions that are usually not publicized or shared with the government or anyone else outside the organization where the incident occurred.... [A] CAP with the transparency executed by ISU could be extremely confining for administrators with responsibility for continuing IT operations and meeting HIPAA and HITECH requirements." (Pepper Hamilton LLP)

Paid Sick Leave: Solving a Health Issue, or Yet Another Burden on Employers?
"Supporters say mandatory paid sick leave is a public health issue that will help prevent the spread of disease by allowing workers who are ill or have a sick child to stay home without fear of losing a day's wages or a job. Others see it as a matter of work-life balance that will enable workers to care for family members. But some employers argue that these laws raise their costs, which could prevent them from hiring new workers or even trigger layoffs." (Workforce; free registration required)

Employers Increasingly Adopting Payment Strategies to Improve Efficiencies in the U.S. Health Care System
"While just 8 percent of companies today limit plan reimbursements to a set dollar amount for certain medical services where wide cost variation exists, almost two-thirds (62 percent) are considering adopting this type of reference-based pricing model in the future.... Fifty-nine percent of employers plan to steer participants -- through plan design or lower cost -- to high-quality hospitals or physicians for specific procedures or conditions. Thirty-eight percent of companies plan to participate in cooperative purchasing efforts with other employers or groups (coalition-based pricing). Twenty-one percent do so today." (Aon Hewitt)

Sole Proprietors and Health Care Concerns: Results of Cigna Survey of the Self-Employed (PDF)
"The My Business, My Health Study explored several topics with this uninsured sole proprietor population to better understand their views on personal health, health insurance and how those two things impact their businesses.... Key findings: One in four (24 percent) self-employed business owner respondents do not have health insurance ... 82 percent of all uninsured respondents said they did not have health/medical insurance because it is too expensive; 80 percent of uninsured respondents overestimated the cost of health insurance; One third of uninsured respondents underestimated the cost of an unexpected, but not uncommon, medical expense like a broken arm." (Cigna)

Beyond Rebates: How Much Are Consumers Saving from the ACA's Medical Loss Ratio Provision?
"The majority of plans sold to small and large businesses were already in compliance with their respective MLR thresholds before the law went into effect, and our analysis shows that traditional MLRs (claims divided by premiums) for group plans have stayed relatively flat over the past three years. In the individual market, by contrast, fewer than half of plans were in compliance with the ACA's MLR thresholds in 2010, and the average traditional MLRs in this market have been steadily increasing since the requirement went into effect.... This year, individual market insurers are expecting to issue $241 million in rebates (based on our analysis of early estimates from insurers filed with state insurance departments), bringing the total estimated savings for 2012 to $2.1 billion." (Kaiser Family Foundation)

New Health Care Model Cut Even More Costs in Year Two
"The nonprofit CareFirst BlueCross BlueShield launched its "Patient-Centered Medical Home" program in January 2011 ... Like other 'accountable care organizations' (ACOs), which are centerpieces of President Barack Obama's healthcare reform, the medical home program ties insurance payments to healthcare providers to the quality of care they deliver.... CareFirst reported cost savings of $98 million for the medical home program in 2012, compared with $38 million the year before. Proponents of the model say it shows that 'bending the cost curve downward'... is achievable." (Reuters)

Poll Finds Support Slumping for Affordable Care Act
"[T]he number calling [the ACA] a bad idea reached a high of 49% in a poll of 1,000 adults taken between May 30 and June 2, with 43% 'strongly' holding that view. Some 37% called the law a good idea. The 12-point gap between supporters and skeptics is the largest since a survey taken in March 2010, the month the health law was passed. Moreover, far more people think they will be worse off under the new law than those who think they will benefit from it, 38% to 19%[.]" (The Wall Street Journal; subscription may be required)

Washington State Health Benefit Exchange Selects Organizations for In-Person Customer Support Program (PDF)
"Ten organizations, including public health agencies, coalitions, regional health networks, and other community organizations, were chosen statewide to help residents enroll in a qualified health plan starting Oct. 1, 2013 for coverage that takes effect on Jan. 1, 2014.... Lead organizations will provide residents with impartial information to help them determine which health insurance option best fits their needs." (Washington Health Plan Finder)

That Employee Who Smokes Costs the Boss $5,800 a Year
"Smoking is expensive, and not just for the person buying the cigs. Employers are taking hard looks at the cost of employing smokers as they try to cut health insurance costs, with some refusing to hire people who say they smoke.... Researchers now say they're got much tighter focus on the number: $5,800 per smoker per year. And the biggest chunk of that comes not in health care costs, but in work lost during all those smoke breaks." (National Public Radio)

Final Regulations Bring Changes for Wellness Programs
"The new regulations ... do nothing to address the continued uncertainty as to the EEOC's view of the application of the Americans with Disabilities Act (ADA) to wellness programs. The EEOC has not yet provided official guidance although EEOC representatives have indicated that significant financial rewards for participation in a wellness program may violate the ADA's prohibition on involuntary medical examinations and inquiries." (Vorys)

Health Care Costs Now the Biggest Recurring Family Expense; Governments Look to Employers to Help
"On average, the employer currently pays about $12,886 of the cost of health care in the form of employer subsidy. The [ACA] does not change this reliance on employer subsidies as the main funding mechanism for health care. So, what measures are being taken to encourage employers to continue or expand health care subsidies?" (Calhoun Law Group)

Retiree Health Care Benefits for State Employees in 2013 (PDF)
"[This] review reveals that (1) state government units offering retiree health care benefits have declined in number during the past decade; (2) retiree health care obligations are concentrated in a minority of states; specifically, of all state retiree health care obligations, 80 percent are attributable to 12 states; (3) on a per capita basis, retiree health care obligations vary widely among states; and (4) states are utilizing a variety of methods designed to shift a greater portion of the cost of providing retiree health care to employees and retirees." (National Association of State Retirement Administrators)


Obamacare Cost Rises by $30 Billion
"The CBO did not model or update a full scoring of repeal. It found that the cost of Obamacare has increased by $30 billion since last July's estimate for the fiscal years 2014-2022, but thinks this could be offset by more cost savings and tax revenue by extending the timeline an additional year. The idea that cost savings are likely to increase is peculiar given that President Obama relied on Medicare cuts. Obamacare cuts $716 billion from Medicare over the next 10 years, according to previous CBO estimates." (The Heritage Foundation)

Benefits in General; Executive Compensation

[Official Guidance]

DOL Releases Retirement Toolkit (PDF)
"This retirement toolkit is brought to you by the three federal agencies involved in key elements of your retirement planning and security: [DOL, SSA and CMS]. The toolkit includes a list of publications and interactive tools to help in your planning, plus information on how to contact us with your specific questions. It is important to start early and be well informed so you can make timely decisions and, if necessary, make changes while you still have time before retirement. The timeline below can help you plan for the kind of retirement you want." (Employee Benefits Security Administration, U.S. Department of Labor)

U.S. Airways, Inc. v. McCutchen: A Win for 'Unambiguous' Plan Terms, but What About the Rest of Them? (PDF)
"While the Court's holding allows employers to feel secure in administering their plans and calculating their costs as prescribed by the terms of the plans, McCutchen also cautions plan sponsors to carefully consider the terms that they include in their plans -- every phrase, word, comma and period. Plan documents should be given the same care and consideration as a multi-million -- or multibillion dollar merger agreements because the financial consequences can be just as significant." (Morgan Lewis, via Bender's Labor & Employment Bulletin)

DOL Worker Classification Survey May Lead to 'Right to Know' Disclosures
"The [DOL] is asking for comments on a proposed Worker Classification Survey, which would be the agency's first survey to examine worker classification issues. According to the notice, the survey would 'collect information about employment experiences and workers' knowledge of basic employment laws and rules so as to better understand employees' experience with worker misclassification'.... The notice has fueled speculation that this could be the first step toward resurrecting a 'Right to Know' disclosure requirement under the Fair Labor Standards Act (FLSA), which the agency first raised in 2010 but never formally proposed." (Towers Watson)

Panel Discusses Developments in Executive and Director Pay
"The trend is for Boards to consider the realizable/realized pay numbers for internal purposes, however, whether or not related disclosure is included in the company's annual proxy is another question.... Many companies have included shareholder engagement on executive compensation and related corporate governance issues as a standard annual exercise.... With the economic downturn, there is a restored interest in and use of mandatory deferred compensation programs.... Directors have a fiduciary duty to protect the interests of all shareholders, provide expertise, and serve as advisors to management. Directors are often paid using a mix of cash and equity, but what forms those take and how equity vests is often up for debate." (Steven Hall & Partners)

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