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July 10, 2013          Get Retirement News  |  Advertise
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Employee Benefits Jobs

Large Group Benefit Consultant
for Northwestern Benefit Corporation of Georgia in GA

Financial Advisor
for retirement advisory services corp in PA

Operations Specialist
for Retirement Plan Services, LLC in MO

401K Administrator
for CPEhr in CA

Enrolled Actuary
for CPEhr in CA

Benefits Specialist
for Foothill-De Anza Community College District in CA

Retirement Plans Regional Sales Manager
for Mutual of Omaha in NE, TX

Pension Administrator
for The Benefits Consulting Group, Inc. in IL

for Benetech, Inc. in CA, GA

Sr. HR Generalist - Worker's Comp/ADA
for Long Beach Memorial Medical Center in

Defined Contrib Analyst II
for The Standard in OH

Retirement Specialist
for Nationwide Insurance in ID

Client Services Manager
for First Federal in SC

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Webcasts and Conferences

US Pensions Summit 2013
July 22, 2013 in IL
(marcus evans)

2013 Retirement Research Consortium Annual Meeting
August 1, 2013 in DC
(Retirement Research Consortium)

"Coverage and Nondiscrimination Testing for Related Employers" Web Seminar
August 1, 2013 WEBCAST
(SunGard Relius)

View All Webcasts and Conferences

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[Guidance Overview]

Taxation of Fringe Benefits: An Update (PDF)
44 presentation slides. Topics include: How Do You Determine the Tax Treatment of a Fringe Benefit? 10 (Usually Loser) Arguments in an Attempt to Justify Failing to Treat a Fringe Benefit as Wages; Update on Employment Tax Examinations; 24 Categories of Fringe Benefits in Recent IDRs; Three Favorite Audit Targets; Tools for Resolving The Consequences of an Employment Tax Examination. (Miller Chevalier, for American Benefits Council)


New In the Foundation Bookstore: Healthcare Reform Facts

Sponsored by International Foundation of Employee Benefit Plans (IFEBP)

Find answers to more than 300 frequently asked questions concerning the Patient Protection and Affordable Care Act (PPACA). Organized in a Q&A format, this reference book addresses implementation, compliance and tax implications for employers. Order now!

[Guidance Overview]

Employer Play-or-Pay Mandate Penalties Delayed Until 2015
"Will employers still need to distribute the mandatory notice to employees regarding public health insurance exchanges by October 1, 2013? If so, should that notice be modified to reflect the delay in the employer play-or-pay mandate? ... Will the public health insurance exchanges still be contacting employers in 2014 to verify employee information (in some cases) on employees' full-time status and health coverage contributions (for purposes of the premium tax credit) -- even though employers will not be subject to penalties under the play-or-pay mandate? If so, will the affordability and minimum value of employer coverage still need to be determined in 2014 for purposes of the premium tax credit if those same elements of the play-or-pay requirements are waived for employers in 2014?" (Towers Watson)

Delay in ACA Requirements Affects Minimum Value Rules
"Gretchen K. Young, senior vice president for health policy at the ERISA Industry Committee in Washington, D.C., [said] that employers affected by the delay in the reporting requirements ... and related employer penalties also may not have to comply with the minimum value standards for another year. The minimum value standards will not matter for 2014 because the penalties will not apply, she said. For employees, however, minimum value 'is still a relevant concern at this point unless, when we get the complete guidance, [it says] something different,' she said." (Bloomberg BNA)

Employers Feeling Impact of Healthcare Reform
"Similar to the 2012 survey, respondents chose healthcare reform as the regulatory issue expected to have the most impact on the workplace over the next 12 months ... Respondents also expected [DOL] regulations under the [ACA] to be the most pressing priority of the current nominee for Secretary of Labor, Thomas Perez ... In reflecting on actions their companies have taken or anticipate taking in response to the ACA's implementation, only 6 percent of respondents noted discontinuing healthcare benefits for full-time employees and paying the penalty under the ACA's 'pay or play' mandate." (Littler)

Faked FMLA Leave Verifications for $54?
"Intermittent FMLA abuse is already a massive headache for employers. Now there are 'deception services' that can actually help employees fake their way into additional time away from work. Say 'hello' to Paladin Deception Services. The company claims it can 'put together almost any fictitious scenario that you require.' And it can do it for just $54. That's right. Your worst fears have been realized. That doctor's office you'll call next time Jack in Accounting claims to have a migraine flare up may not be a doctor's office at all." (HR Benefits Alert)

How Well Do You Know Which Benefits Are Subject to Employment Taxation?
"While employer-provided benefits or payments generally are well received and appreciated by employees, there may be attendant tax consequences to both the employee and the employer that must be addressed. Many times employees are shocked that a benefit is actually subject to taxation. Of critical concern is whether an employer-provided benefit or payment constitutes taxable income to the employee and is subject to federal income tax withholding, Social Security and Medicare (both, FICA), and FUTA taxation. In addition, while some benefits may not result in taxable income, their receipt may require reporting to the IRS by the employer." (Bloomberg BNA)

Seeing Opening, House GOP Pushes Delay on Individual Mandate in Health Law
"House leaders began devising strategies that would most likely start this month with multiple votes, the first to codify the one-year delay on the employer mandate, then another to demand a delay on the individual mandate. They calculate that Democrats would first vote to back the administration's decision, and would then have a hard time opposing the second measure. Some Republicans raised the possibility that a provision to repeal the individual mandate could be attached this fall to legislation raising the government's statutory borrowing limit." (The New York Times; subscription may be required)

Employees Often Pick Lower-Cost Health Plans
"Sixty percent of employees allowed to choose between a traditional employer-sponsored health insurance plan and a cheaper, high-deductible or limited network plan opted for the lower prices ... Each plan's benefits were the same; just the payment structure differed. For example ... if an employer had paid $600 a month in premiums and the employee $100 before, the employee could instead choose a plan that cost $400 a month with a lower employee premium but a higher deductible. The extra $200 a month from the employer could either go into a health savings account or toward another insurance policy, such as life, vision or dental. About half of the employees chose plans with health savings accounts." (USA TODAY)

Additional Minnesota State Tax Withholding Required in 2013 for Certain Employee Fringe Benefits
"Under section 127 of the Internal Revenue Code, employers may provide tax-free educational benefits of up to $5,250 per year. Earlier this year, federal law permanently extended this tax-favored treatment. However, Minnesota did not adopt this extension ... In January 2013, federal law ... raised the tax-exempt limit for transit pass/vanpool benefits to $245 per month. Minnesota chose not to match the federal tax treatment of transit pass/vanpool benefits, and instead kept the state tax-exempt limit at $125 per month... Earlier this year, federal law extended tax-favored treatment of adoption assistance benefits so that employers are allowed to exclude up to $12,970 of qualified adoption assistance benefits from an employee's taxable wages in 2013. Minnesota did not adopt this extension[.]" (Faegre Baker Daniels LLP)

Analysis of Benefits Under Proposed Disability Benefit Changes for Federal Employees
"This testimony presents results of GAO's four recent reports on [Federal Employees' Compensation Act ('FECA')] issues. It summarizes (1) potential effects of the proposals to compensate total-disability FECA beneficiaries at a single rate; (2) potential effects of the proposal to reduce FECA benefits to 50 percent of applicable wages at full Social Security retirement age for total-disability beneficiaries; and (3) how partial disability beneficiaries might fare under the proposed changes. To do this work, GAO conducted simulations comparing FECA benefits to income (take-home pay or retirement benefits) a beneficiary would have had absent an injury, and conducted seven case studies of partial disability beneficiaries." (U.S. Government Accountability Office)

House Ways and Means Chairman Brady Opening Statement at Hearing on the Delay of the Employer Mandate
"This Committee has serious questions about how and why this alarming decision was made and the effect that delaying this key provision will have on other provisions of the law -- specifically the directive that individuals purchase government-approved health care or pay a tax. There are also questions about the unprecedented manner in which it was announced: on an obscure Treasury blog site just two days before the 4th of July. We invited Treasury officials to testify today to explain to the American people the rationale for the delay and how they announced this major setback. However, they declined to appear today." (Committee on Ways and Means, U.S. House of Representatives)

Senate and House Committee Republican Leaders Seek CBO Cost Estimate of Obamacare
"Last week, the Obama administration decided to ignore specific requirements in the health care law as mandated by Congress, conceding their signature legislative achievement is unworkable. This action will alter previous CBO cost and coverage estimates. To get answers for the American people, the chairmen and ranking members of key House and Senate committees asked CBO director Doug Elmendorf, in consultation with the Joint Committee on Taxation, to determine how this delay will affect individual consumers, the insurance exchanges, and Medicaid spending." (Committee on Education & the Workforce, U.S. House of Representatives)

Vermont Announces Premiums on Health Insurance Exchange
"Rates being offered for the benchmark so-called 'silver plan' for individuals will be a bit less than $395 per month for individuals buying a Blue Cross Blue Shield product, and $410 a month for those buying a similar policy form MVP Health Care. Those prices are similar to what an individual pays now for a similar suite of coverage options[.]" (Stamford Advocate)

Current Medicaid Patients Will Miss Out on Better Preventive Care in 2014
"A hallmark of President Obama's health law is that it requires insurers to cover early detection and disease prevention services at no cost to the patient. The new preventive care guidelines are intended to improve overall health, reduce the number of preventable deaths and lower costs. But some of the nation's unhealthiest people -- 25 million low-income adults who already qualify for Medicaid -- aren't likely to receive those benefits, because the requirements in the [ACA] pertain only to private insurers, Medicare and Medicaid expansion programs." (Kaiser Health News)

CBO Forecasts Keep Getting Worse
"The Congressional Budget Office (CBO) estimated in May that the employer mandate would raise $10 billion in revenue in its first year.... That $10 billion in employer mandate revenue projected for fiscal year 2015 will almost certainly disappear.... The CBO now projects that, if firms do drop health coverage, insurance subsidies on exchanges will average $5,290 per enrollee next year. By comparison, shortly after ObamaCare passed, the CBO projected subsidies would average $3,970 in 2014." (John Goodman's Health Policy Blog)

ACA Stakeholders Use 'Registration for Technical Assistance Portal'
"REGTAP, or Registration for Technical Assistance Portal, [is] a forum for Centers for Medicare and Medicaid Services.... [It] includes a variety of materials including FAQs, presentation slides, supporting documents, white papers, and instructions. It is aimed at exchanges, regulators, insurers, and agents and brokers, and is accessible only by registration. Registration is simple, however, and gives the user access to a wealth of information. Activity on the website seems to have picked up dramatically in recent days, as implementation draws nearer." (Timothy Jost in Health Affairs)

Obamacare Delay Poses Legal Risk to Employers
"For many workers, the federal subsidies will be more lucrative than the contributions toward their health-care benefits that their employees will make in 2015... Those who are subsidy-eligible must pay a percentage of their income toward the insurance premiums. At 100 percent of the federal poverty level, that rate is 2 percent. But an employer-sponsored health plan meets the affordability requirement of the ACA if it costs employees as much as 9.5% of their income. And therein lies the rub: Those whose employers offer qualifying health insurance will not be eligible for the federal subsidies. 'So, an employee could go from paying 2 percent of their income for health insurance in 2014 to 9.5 percent in 2015,' says [labor lawyer Chris] Condeluci. 'When you look at the number of employees in those [low-paying] industries who work between 30 and 40 hours, this is a very valid issue to raise.'" (CFO.com)


Here Are 58,000 Obamacare Harms That Can't Be Repealed or Delayed
"UnitedHealthcare will join Aetna in pulling out of California's individual health insurance market. An estimated 58,000 people will have their policies canceled. If these policies were grandfathered, it is unlikely that the people who were insured will be able to replace them. Higher deductibles mean lower premiums ... [and] over a third of individuals and families with individual coverage had chosen deductibles above the ObamaCare limits of $2,000 for individuals and $4,000 for families. For them, the new ObamaCare compliant plans may offer more limited networks and higher costs." (John Goodman's Health Policy Blog)


British Petroleum's Wellness Program is Spewing Invalidity
"[L]et's see what happens when one compares the [conclusion of a recent study] -- that the Staywell wellness program for BP America achieved almost $20,000,000 in savings on 20,343 BP participants after only two short years -- to the limits of possibility. It turns out this overall savings claim of $1,000/person would require completely wiping out wellness-sensitive medical events (heart attacks, diabetes events etc.) not just on those 20,000+ people, but also on perhaps 40,000 of their closest friends." (The Health Care Blog)


Obamacare Is the Problem, Health Savings Accounts Are the Solution
"HSAs and their incentives have proven very effective in controlling costs in the real world. Total HSA costs, including the savings to fully fund the HSA savings account to cover the deductible, have run about 25 percent less than costs for traditional health insurance. Annual cost increases for HSA/high-deductible plans have run more than 50 percent less than conventional health care coverage, sometimes with zero premium increases. As a result of these costs savings: The number of HSA accounts rose 22 percent in 2012 alone, to more than 8 million. Total HSA account assets zoomed 27 percent to $15.5 billion. By 2015, HSA balances are expected to increase to almost $27 billion." (National Center for Policy Analysis)


Stop the Churning of Coverage for Low-Income People
"Churning [-- being the term for repeatedly gaining and losing health insurance coverage --] is particularly acute in the population covered by Medicaid and the Children's Health Insurance Program (CHIP), where minor changes in family income (a dollar raise or a few more hours worked), changes in life circumstances (becoming pregnant or turning 19 and becoming an adult), or failing to keep up with the programs' often frequent and onerous demands for paperwork to prove eligibility, can mean the difference between having coverage, or not.... Unstable coverage can lead to the same negative effects as having no coverage at all." (The Commonwealth Fund)


Letter from U.S. Chamber of Commerce in Support of S. 1188, the 'Forty Hours Is Full Time Act of 2013' (PDF)
"Employers have considered a full-time employee to be one who works 40 hours a week for decades. With the definition as it now stands, many businesses are having to restructure their workforce and reduce their employees' hours to avoid costs that could potentially bankrupt their companies. Not only will many employees not receive health care coverage, but they may also lose their full-time wages as a result. By reverting back to the traditional definition, employees would be protected and employers would no longer face this barrier to business growth." (Chamber of Commerce of the United States of America)

Benefits in General; Executive Compensation

[Guidance Overview]

The DOMA Decision's Impact on Employee Benefit Plans (PDF)
12 pages. Includes charts comparing pre- and post-Windsor plan requirements. Excerpt: "While in most cases the post-Windsor tax treatment of health and welfare benefits will be more favorable to the same-sex spouse than previously, this will not always be the case. For example, under DOMA each same-sex spouse could have their own HSA. Post-Windsor, the rules that apportion the maximum contribution between spouses will apply to same-sex spouses ... [For retirement plans,] retroactive relief by the IRS would not necessarily apply to participant litigation under ERISA or any other law. But [the authors] believe qualified retirement plans will have some defenses available if such claims are made." (Alston & Bird)

[Guidance Overview]

New York Provides Guidance to State-Funded Service Providers on Complying with Compensation Limits under Executive Order #38
"New York State has now released more information to help covered service providers comply with Executive Order #38's limits, including: Preliminary Guidance that provides instructions on: the recommended processes for determining covered provider status; determining compliance with executive compensation and administrative expenses limitations; submitting the EO#38 Disclosure Form; filing a waiver application; and preparing a Corrective Action Plan (CAP). [Also released were four] worksheets to help covered providers perform the calculations needed to comply with these new requirements." (Practical Law Company)

Evaluating Broad-Based Approaches for Limiting Tax Expenditures
"This paper evaluates six options to achieve across-the-board reductions to a group of major exclusions and deductions in the income tax: (1) limiting their tax benefit to a maximum percentage of income, (2) imposing a fixed dollar cap, (3) reducing them by fixed-percentage amount, (4) limiting their tax saving to a maximum percentage of their dollar value, (5) replacing them with fixed rate refundable credits, and (6) including them in the base of the existing Alternative Minimum Tax (AMT). We discuss issues of design, implementation, and administration, and simulate the revenue, distributional, and incentive effects of the various options." (Tax Policy Center, a project of Urban Institute and Brookings Institution)

The Unintended Consequences of Say on Pay Votes
"The confluence of Say on Pay (SOP) votes and heightened scrutiny plus the influence of proxy advisory firms (particularly ISS) are having a major unintended consequence -- the movement to 'one-size-fits-all' or homogenization of executive compensation programs.... [S]ome of the new homogenized practices may be perfectly acceptable for a given company or group of companies in a given set of circumstances, but it is unlikely that such uniformity is ideal for the large number of companies conforming due to external pressure." (The Harvard Law School Forum on Corporate Governance and Financial Regulation)


The Evolution of Companies' and Investors' Views of Company Stock Pledging Arrangements in 2013
"[It] seemed that ISS criticized every client that disclosed an existing pledging arrangement among its officers and directors. The fact ... that all of the directors at all of the companies that ISS criticized ... is, in [the author's] judgment, the result of ISS' waning influence and investors deciding that reasonable pledging arrangements, i.e., those that are not as extreme as those that were uncovered at Chesapeake Energy and Green Mountain Coffee Roaster, were not troubling." (Michael S. Melbinger of Winston & Strawn LLP)

Press Releases

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