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July 17, 2013          Get Retirement News  |  Advertise
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Employee Benefits Jobs

Manager, Retirement Plan Administration
for SchoolsFirst Federal Credit Union in CA

Financial Planner
for New York Life Retirement Plan Services in MA

Retirement Educator 2
for Wells Fargo in VA

Sales Administrative Coord
for The Standard in CA

Benefit Services Specialist
for Northwestern Benefit Corporation of Georgia in GA

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Webcasts and Conferences

401(k) Plans: Beyond the Basics 2013 - A 2-day seminar, 6 Cities, September - October
September 11, 2013 WEBCAST
(SunGard Relius)

"Advanced Cross-Tested Plans: Adding More Tools," 12 Cities, September - October
September 11, 2013 WEBCAST
(SunGard Relius)

EPCRS: Correcting 401(k) Plan Mistakes -- Phone Forum
July 25, 2013 WEBCAST
(Internal Revenue Service (IRS))

Capturing IRA Rollovers & "Money in Motion"
October 17, 2013 in MA
(Financial Research Associates)

Workplace Wellness That Delivers - Webinar
July 30, 2013 WEBCAST

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[Guidance Overview]

Final Regs Require Wellness Plans to Get a Checkup (PDF)
"While the language is consistent with the 2006 regulations, the notion of participatory programs expressed in the final (and proposed) regulations differs from that commonly known in the wellness community as a 'participatory program.' Commonly understood, a participatory program was a program available to all similarly situated employees, regardless of a health condition. For example, a 'Get Healthy' walking program, not targeted at those with a specific health issue, but available to the entire employee population, had been considered participatory. Under the final regulations, however, such a program would not be participatory, but rather an activity-only program in the health-contingent category and subject to the wellness requirements. Under the final regulations, participatory programs appear to be more passive and generally don't include an activity." (Buck Consultants)


Evaluating Your Third-Party Administrator: Are You Getting What You're Paying For?

Sponsored by Lorman and BenefitsLink

Identify key areas for identifying and evaluating proper plan administration. Covers both retirement and health and welfare plans. >Registration discount for BenefitsLink readers.

[Guidance Overview]

Administering FMLA Leave after the DOMA Ruling
"Applied to a request for FMLA leave to care for a same-sex spouse who is a 'covered servicemember,' 29 CFR sec. 825.122(k) would appear to allow a request for a marriage certificate or similar documents to verify the employee resides in a state that recognizes same-sex marriage. As the regulation allows an employer to request a birth certificate to confirm a family relationship, an employer may reasonably be allowed to request a marriage certificate or similar documents to confirm a spousal relationship. In jurisdictions that prohibit discrimination based on sexual orientation, employers should be more cautious in requesting such documentation, especially if they do not make the same requests of employees in heterosexual marriages." (Jackson Lewis LLP)

[Guidance Overview]

Must Your Company Pay the PCORI Fee by July 31, 2013?
"If your company offers a self-insured health and welfare plan, a HRA, or a FSA, your company must pay a fee per covered person by July 31, 2013 on Form 720. While the actual fee can be easily calculated (rate x average number of covered lives), determining what plans are subject to the fee and the average number of covered lives can be quite complicated. In some cases, a single individual may count as more than one covered life." (Belfint Lyons & Shuman, CPAs)

Testimony of Treasury Department Official on Decision to Delay Information Reporting and Employer Mandate (PDF)
"Notice 2013-45 is an exercise of the Treasury Department's longstanding administrative authority under section 7805(a) of the Internal Revenue Code. This administrative authority has been used to provide transition relief for taxpayers seeking to comply with new legislation, and to provide a wide range of other guidance. In particular, on a number of prior occasions across Administrations, this authority has been used to postpone the application of new legislation when immediate application would have subjected taxpayers to unreasonable administrative burdens or costs." (J. Mark Iwry, Senior Advisor to the Secretary and Deputy Assistant Secretary for Retirement and Health Policy, U.S. Department of the Treasury)

Delay of Employer Mandate May Hamper Enforcement of Individual Mandate
"[T]he delayed [employer mandate provisions in the ACA] also required companies to report health insurance details for employees. Without employers validating who's covered, a scofflaw could lie, and the government would have no easy way to check. The Treasury Department said ... it expects any impact to be minor, since most people will not risk telling the government a lie. Still, it's another incentive for uninsured people to ignore a new government requirement that for many will cost hundreds of dollars.... [M]ost Americans truthfully report their annual income to the [IRS], said [a Treasury] official, who spoke only on condition of anonymity ... However, most people know the IRS already has the income information from their employers on W-2 forms." (The Washington Post)

New Missouri Law Requiring Licenses Will Impose Hurdle for Health Insurance Navigators
"The new state law requires insurance counselors -- known as navigators -- get state licenses before they begin helping consumers shop for health plans on the exchange. But no state regulatory framework is in place. And even if it's set up quickly, the law could make it hard for navigators to do their jobs because it bars them from providing advice about health plan features or recommending a specific plan." (St. Louis Post-Dispatch via Kaiser Health News)

Health Insurance Cost for New Yorkers Set to Fall 50%
"State insurance regulators say they have approved rates for 2014 that are at least 50 percent lower on average than those currently available in New York. Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly. With federal subsidies, the cost will be even lower." (The New York Times; subscription may be required)

Here's Why Health Insurance Premiums Are Tumbling in New York
"New York has, for 20 years now, been a long-running experiment in what happens to universal coverage without an individual mandate.... For years New York has had one of the most heavily regulated insurance markets in the country. The 1993 reforms not only required insurers to accept all customers; they also mandated that insurers charge everyone the exact same price. Young or old, healthy or sick, it doesn't matter in New York: Everyone gets the same deal." (The Washington Post)

Meet Serco, the Private Firm Getting $1.2 Billion to Process Your Obamacare Application
"Based just outside of Washington in Reston, Va., Serco is a 25-year-old firm that pretty much owes its existence to government contracting....'This type of high volume, all coming in fast applications, that is one of our skill sets we have an experience in,' [Alan Hill, Serco's head of media relations] said. 'That's why we're excited about getting to work with HHS on this.'" (The Washington Post)

New York City Council Passes Paid Sick Leave Law Over Mayor's Veto
"[Beginning on April 1, 2014,] private sector employers with 20 or more employees within New York City will be required to offer at least 40 hours of paid sick leave per year to each employee ... Private sector employers with less than 20 employees within New York City will be required to offer at least 40 hours of unpaid sick leave per year to each employee ... The number of employees that an employer has is determined by counting all compensated workers during a given week, including full-time, part-time, and per diem employees." (Bond Schoeneck & King)

GAO Report on Status of CMS Efforts to Establish Federally Facilitated Health Care Exchanges and the Federal Data Services Hub (PDF)
"While CMS stated that the agency had thus far met its project schedules and milestones for establishing agreements and developing the data hub, several critical tasks remained to be completed before the October 1, 2013, implementation milestone.... [W]hile missed interim deadlines may not affect implementation, additional missed deadlines closer to the start of enrollment could do so.... Whether CMS's contingency planning will assure the timely and smooth implementation of the exchanges by October 2013 cannot yet be determined." (U.S. Government Accountability Office)

Ongoing Challenges to ACA under the Origination Clause
"In the wake of [NFIB v. Sebelius], plaintiffs still wishing to challenge the constitutionality of PPACA have looked to new theories on which to challenge the legislation. A series of recent cases have focused the Constitutionality discussion on the first clause of Article I, Section 7 of the Constitution (more commonly referred to as the 'Origination Clause'), which generally requires that 'all revenue raising bills (e.g., tax bills) originate in the House of Representatives'.... Historically, the judicial role in enforcing the Origination Clause has been limited. Typically, Justices have been reluctant to look behind a bill as enrolled to determine its validity.... Still, commentators assert that if ever there was an act could be deemed to violate the Origination Clause, it would seem to be PPACA." (Benefits Bryan Cave)

Fourth Circuit Upholds Employer Mandate
"Unlike the individual mandate ... the court noted that Congress could certainly regulate an employer's terms of compensation paid to employees because the employers were already engaged in interstate commerce. The mandate does not require employers to purchase something in the private market because they are free to self-insure the benefits (and thereby the benefits would simply be another version of employer-paid compensation). It was not a great leap from these conclusions to a holding that insurance benefits were a reasonably-regulated element of that compensation, and therefore the mandate is no different (in a constitutional sense) from minimum wage laws." [Liberty University, Inc. v. Lew, No. 10-2347 (4th Cir. July 11, 2013)] (Littler)

ML Strategies Health Care Reform Update, July 15, 2013 (PDF)
Update on developments in federal and state health care reform legislation and regulations, including summaries of recent announcements and regulatory activity by HHS, CCIIO, IRS and CMS. (ML Strategies, LLC)

Intel Offers Employees Narrow Network of Health Insurance
"Dissatisfied with previous cost and quality efforts, computer chip giant Intel Corp. has entered an unusual direct contract with Presbyterian Healthcare Services for a narrow-network, accountable care-style arrangement ... The arrangement ... covers about 5,400 individuals ... Intel employees who selected Presbyterian's narrow network coverage will pay more for seeking care elsewhere. Presbyterian, which now operates a clinic at Intel's Rio Rancho plant, will receive a bonus if it meets quality goals and Intel's employee healthcare costs stay under a set target." (Modern Healthcare Online; free registration required)

Health Care Spending after Adopting a Full-Replacement, High-Deductible Health Plan With a Health Savings Account: A Five-Year Study (PDF)
"This study represents one of the longest observation periods reported with a full-replacement CDHP, and it is one of the few studies with a matched control group. In the first year of the HSA, the employer's aggregate health care spending was reduced by $527 per person.... Further, the magnitude of the cost savings was greatest in this first year but the cost savings continued over the succeeding three years albeit at a slower pace.... [O]nly pharmacy and laboratory spending were statistically significantly lower throughout the entire four years after the HSA plan was adopted." (EBRI)

Nine Pioneer ACOs Jump Ship After First Year
"Nearly a third of the health systems chosen for the ambitious Pioneer accountable care organization program with Medicare are leaving after the first year of the three-year program.... The 32 Pioneers generated a gross savings of $87.6 million in 2012. But only 13 of the Pioneers actually saved enough money to share those savings with Medicare, despite having invested in the programs and staff required to better coordinate care. And two Pioneers ended up owing the Medicare program $4 million." (Kaiser Health News)

Health Care Law is Top Concern of Small Business
"Concern about Obamacare has increased by 10 points since June 2011 and by 4 points since last quarter. 71% of small businesses say the health care law makes it harder to hire. Only 30% say they are prepared for the requirements of the law, including participation in the marketplaces. Among small businesses that will be impacted by the employer mandate, one-half of small businesses say that they will either cut hours to reduce full time employees OR replace full time employees with part-time workers to avoid the mandate. 24% say they will reduce hiring to stay under 50 employees." (U.S. Chamber of Commerce)

CBO Letter Providing Preliminary Review of H.R. 2668, the 'Fairness for American Families Act' (PDF)
"CBO and the staff of the Joint Committee on Taxation (JCT) have begun a review of H.R. 2668, the Fairness for American Families Act, but we have not yet completed a cost estimate for the bill. On a preliminary basis, however, we expect that enacting H.R. 2668 would have the effect of reducing the deficit in 2014 and over the 2014-2023 period.... The legislation would delay for one year the requirement that nearly every resident of the United States have health insurance coverage by January 1, 2014. The bill also would shift by one year the schedule of penalties for people who do not comply with the mandate." (Congressional Budget Office)

January 1, 2014: Get Ready for the Obamacare Health Insurance Tax
"[S]mall businesses still must deal with a part of the law that will come calling on Jan. 1, 2014: the health insurance tax. The tax is ... something of a sales tax on insurance plans sold by health carriers and it packs a mighty punch. Officials estimate the tax will generate $8 billion in revenue in 2014, a figure expected to jump to $14.3 billion in 2018. The hefty levy is expected to capture $100 billion through the next decade.... AHIP predicts the tax will cost 146,000 to 262,000 jobs between now and 2022, and could reduce potential sales between $19 billion and $35 billion." (IdahoReporter.com)

Electronic Health Records Have Mixed Effect on Health Costs
"Using electronic health records (EHRs) saved a little more than 3% in ambulatory health costs 18 months after adoption but didn't reduce overall inpatient costs ... With that rate of savings, it would take 7 years to recoup the projected 5-year adoption costs for an EHR[.]" (MedPage Today)

Seven Significant Factors Driving Up Health Insurance Premiums
"[H]ealthcare spending is growing 2.4% faster than the country's GDP, making it almost impossible to manage in this barely recovering economy.... A thorough examination ... of a variety of available data revealed that the 7 most significant causes for increasing healthcare costs are new medical technology, provider price inflation, low primary care use, high spending on specialists, aging population, increase of chronic illnesses, and fraud. These factors drive your health insurance premiums up remarkably." (MedCity News)

Public Health Insurance, Labor Supply, and Employment Lock (PDF)
"[Results of this study] suggest a significant degree of 'employment lock' -- workers employed primarily in order to secure private health insurance coverage. The results also suggest that the [ACA] -- which similarly affects adults not traditionally eligible for public health insurance -- may cause large reductions in the labor supply of low-income adults." (National Bureau of Economic Research)


Coalition of 36 Trade Associations Sends Letter to Congress on H.R. 2667, the 'Authority for Mandate Delay Act'
"In light of the Administration's recent decision to delay the enforcement of the employer mandate penalties and reporting requirements, it is vital that Congress take legislative action to clearly and directly delay this 'shared responsibility' provision in the health care law.... Legislatively delaying the employer mandate will ease these concerns in the short term and is necessary to provide businesses clarity about their legal obligations for the future. With the delay, a careful and pragmatic assessment of the mandate must follow to assess how to create better policies that do not turn our country into a nation of part-time workers." (U.S. Chamber of Commerce, National Association of Manufacturers, and 34 other trade associations)


Don't Delay Health Reform's Individual Mandate
"Given the many misleading statements that some critics have made about the 'individual mandate,' it's worth repeating some basic facts: The vast majority of Americans already satisfy the mandate.... Most uninsured Americans want coverage.... The uninsured will get substantial help buying coverage.... The mandate is critical to reforming the flawed individual insurance market... Millions more people would remain uninsured without the mandate.... The small number of uninsured people who don't want coverage will simply pay a modest fee in 2014[.]" (Center on Budget and Policy Priorities)


Health Care Spending: What's In Store?
"The spending predictions reported to date are so divergent that it seems who is reading the tea leaves matters as much as the pattern left on the bottom of the cup. But regardless of which view you favor, it is likely that the ultimate trajectory will be determined by four forces that are moving inexorably, like tectonic plates, to shape the future landscape of American health care. [1] Health Care Reform ... [2] Information Asymmetry ... [3] Cost-Sharing ... [4] Innovation." (Arthur Kellermann in Health Affairs)

Benefits in General; Executive Compensation

[Guidance Overview]

Ding Dong, DOMA's Dead ... Or Is It? (PDF)
"How will plans, particularly those that have participants in multiple states, treat same-sex partners for purposes of the beneficiary and QJSA rules, hardship distributions, spousal rollovers, controlled group aggregation, HCE determinations? Is it reasonable that a married couple will get certain benefits or limitations in one state, and that participants residing in other states will be denied those benefits or limitations? How does that affect nondiscrimination testing, particularly with regards to benefits, rights, and features? Does a plan need to be amended to clarify who constitutes a spouse?" (Ferenczy + Paul LLP)

[Guidance Overview]

Nonqualified Deferred Compensation Distributions in Corporate Transactions
"In corporate transactions, it is often not clear whether nonqualified deferred compensation (NQDC) can be or must be distributed to employees, especially when the NQDC plan requires payments upon a participant's separation from service. Whether such a separation takes place under Internal Revenue Code section 409A, which governs the tax treatment of NQDC, depends on the nature of the transaction ... A sale of assets of a business constitutes a separation from service for employees who go to work for the buyer ... A corporate transaction that involves a sale or spin-off of stock generally does not create a separation from service for employees of the entity whose stock is sold or spun off.... An IPO does not cause a separation for employees of the corporation whose shares have been sold to the public.... A transaction that is not a separation may be a [change in control (CIC)] under section 409A. In a CIC, the plan sponsor may provide for accelerated payment of the deferred compensation to affected employees." (Towers Watson)

BLS Report of Employee Benefits in the U.S. in March 2013 (PDF)
"Employer-provided medical care was available to 85 percent of full-time private industry workers in the United States in March 2013 ... [O]nly 24 percent of part-time workers had medical care benefits available. Access, or availability, also varied by employment size: 57 percent for all workers in small establishments (those with fewer than 100 employees), compared with 85 percent in medium and large establishments (those with 100 employees or more).... In private industry, 74 percent of full-time workers had access to a retirement plan, significantly higher than 37 percent of part-time workers. Retirement benefits were available to 49 percent of workers in small establishments and 82 percent of workers in medium and large establishments." (U.S. Bureau of Labor Statistics)

DOL and Treasury Publish Update to 2012-2013 Regulatory Agendas for Employee Benefits (PDF)
"Projects added to the agendas since they were last published are shown in [this article]. There are two new DOL initiatives and three new tax initiatives. We also anticipate upcoming guidance regarding the recent U.S. Supreme Court decision holding that Section 3 of the federal Defense of Marriage Act is unconstitutional, but those guidance projects have not yet been announced." (Sutherland)

Press Releases

IRS Cancels July 22 Furlough Day
Internal Revenue Service (IRS)

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