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November 27, 2013          Get Retirement News  |  Advertise
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Plan Administrator
Retirement Plan Services, LLC
in IL, MO

Defined Contribution Plan Administrator
Touchstone Retirement Group
in ANY STATE

401(k) Plan Administrator
Houston TPA Firm
in TX

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Research Triangle, NC TPA
in NC

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Webcasts and Conferences

Benefits Issues You Should Be Thinking About When Working End of Year Deals
December 5, 2013 WEBCAST
(American Bar Association (ABA))

Ethics for Compensation and Benefits Lawyers
December 10, 2013 WEBCAST
(American Bar Association (ABA))

Issue Spotting Across the Globe for Expatriate Executive Packages
December 17, 2013 WEBCAST
(ABA Joint Committee on Employee Benefits)

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official guidance, jobs, webcasts and more.
[Official Guidance]

Text of IRS Final Regs Relating to Additional Medicare Tax
"The final regulations provide guidance for employers and individuals relating to the implementation of Additional Medicare Tax, including the requirement to withhold Additional Medicare Tax on certain wages and compensation, the requirement to file a return reporting Additional Medicare Tax, the employer process for adjusting underpayments and overpayments of Additional Medicare Tax, and the employer and individual processes for filing a claim for refund of Additional Medicare Tax." (Internal Revenue Service)  


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[Official Guidance]

Text of Rev. Rul. 2013-27: Gross Income of Covered Entity Includes Amounts Collected to Offset Annual Health Insurance Providers Fee (PDF)
"Amounts a taxpayer charges customers for goods and services typically offset the taxpayer's costs of doing business. No provision of the Code or other law excludes these amounts from a taxpayer's gross income simply because the taxpayer is passing overhead costs and other business expenses to its customers. As discussed below, these amounts consistently have been found to be includible in income.... Amounts a covered entity collects from policyholders to offset the cost of the annual fee imposed on health insurance providers under Section 9010 of the ACA are included in the covered entity's gross income under Section 61(a)." (Internal Revenue Service)  

[Official Guidance]

Text of IRS Notice 2013-76: Health Insurance Providers Fee, Procedural and Administrative Guidance (PDF)
"This notice provides guidance on the health insurance providers fee related to [1] the time and manner for submitting Form 8963, 'Report of Health Insurance Provider Information,' [2] the time and manner for notifying covered entities of their preliminary fee calculation, [3] the time and manner for submitting a corrected Form 8963 for the error correction process, and [4] the time for notifying covered entities of their final fee calculation." (Internal Revenue Service)  

[Official Guidance]

Text of IRS Final Regs on Health Insurance Providers Fee
"The final regulations modify this category of covered entity to more closely align with section 9832(b)(2), which provides that a health insurance issuer must be licensed to engage in the business of insurance in a State and not merely required to be licensed as stated in the proposed regulations.... [A] MEWA within the meaning of section 3(40) of ERISA is an entity that provides health insurance for purposes of section 9010 to the extent that the MEWA is not a fully-insured MEWA and regardless of whether the MEWA is subject to regulation under State insurance law. In addition, such a MEWA is not eligible for the exception from the fee under section 9010(c)(2)(A) for self-insured employers.... [In] the case of a multiemployer plan that maintains a VEBA, neither the plan nor the VEBA is a covered entity.... Because the scope of stop-loss coverage that may constitute health insurance, if any, has not been determined, the final regulations do not expressly include stop-loss coverage in the definition of health insurance. Accordingly, section 9010 will not apply to stop-loss coverage until such time and only to the extent that future guidance addresses the issue of whether, and if so under what circumstances, stop-loss coverage constitutes health insurance." (Internal Revenue Service)  

[Guidance Overview]

HHS Publishes Proposed Notice of 2015 Benefit and Payment Parameters
"[A]lthough the Proposed Notice does make some adjustments in the program for 2014, it is primarily oriented toward the second year of the program, 2015.... The Proposed Notice lowers the attachment point to $45,000 [for 2014], recognizing that the pool of covered individuals is likely to be smaller and higher-risk than initially anticipated.... HHS proposes changes in its 2014 risk corridor program.... [including] changing the definition of allowable costs by increasing the profit margin floor (currently set at 3 percent) and the administrative cost ceiling (currently 20 percent after taxes) to increase the risk corridor payments to offset lower premium revenue and increased claims costs.... The 2015 risk adjustment program will use the same methodology as the 2014 program with a few changes." (Health Affairs Blog)  

[Guidance Overview]

Avoiding HIPAA Business Associate Agreements
"Entities should avoid executing unnecessary business associate agreements; doing so may subject them to contractual liabilities they would not have but for the agreement, including the costs of complying with regulations that do not otherwise apply; limits on the use of disclosure of information; and damages for failure to comply. In addition, by executing unnecessary business associate agreements, the entity may be inappropriately admitting that it is a business associate, thereby exposing itself to HIPAA penalties for noncompliance." [Includes a two-page Business Associate Decision Tree.] (Holland & Hart LLP)  

Obamacare's Small Business Marketplace Remains Stalled
"Companies with up to 50 employees can browse plans on healthcare.gov ... There's no place ... to get a single quote that includes some employees on family plans and some on individual coverage. Actually applying for small business coverage on healthcare.gov right now requires both online and offline steps. Employers must set up an online account, then download a PDF application.... There's no sign from the government that this is going to get much easier soon." (Bloomberg BusinessWeek)  

Obama Administration Backs Off Promise to Have Small-Business Web Site Ready by Sunday
"Obama administration officials are again backing off twice-delayed promises to small-business owners concerning the readiness of the federal government's new employer health-insurance marketplace. Down to the last four days of November, Department of Health and Human Services officials are no longer standing by a pledge to have the online small-business exchange fully functional by the end of the month. Instead, they say, employers will have a process by which to enroll in coverage by then, but it might not necessarily be feasible through healthcare.gov." (The Washington Post; subscription may be required)  

The Skinny on Employer-Sponsored 'Skinny Plans'
"A loophole in the [ACA] allows employers to avoid the heaviest 'employer mandate' penalty ... by offering so-called 'skinny plans' -- a group health plan designed to cover only non-catastrophic health exposures like wellness benefits, preventive care and certain routine medical care. Staffing firms planning to offer skinny plans hope the savings from avoiding the 'no offer' penalty will outweigh the combined cost of the skinny insurance and penalties generated by employees who reject the skinny insurance and obtain subsidized coverage from state exchanges.... [S]ome employees who accept the employer's insurance may not fully understand the limited scope of its coverage and believe that it is comprehensive health insurance." (Staffing Industry Analysts)  

A Plea to Avoid Crush of Users at healthcare.gov
"White House officials, fearful that the federal health care website may again be overwhelmed this weekend, have urged their allies to hold back enrollment efforts so the insurance marketplace does not collapse under a crush of new users. At the same time, administration officials said Tuesday that they had decided not to inaugurate a big health care marketing campaign planned for December out of concern that it might drive too many people to the still-fragile HealthCare.gov." (The New York Times; subscription may be required)  

Are ACOs Really Different from HMOs?
"Accountable care organizations (ACO) aim to completely revamp how healthcare is delivered in the United States, promising better quality and lower costs. But physicians who have heard these promises before are wondering if ACOs are just the new version of HMOs, the same lofty concept dressed up in a new way." (HealthLeaders Media)  

IRS Outlines 2014 Monthly Qualified Transportation Plan Limits
"The monthly limit in the cash that can be excluded from an employee's income for the sake of qualified parking benefits will be $250 starting in 2014, up slightly from the $245 limit that was in place throughout 2013. The 2014 combined monthly limit for transit passes used by commuter highway vehicles is now $130, however, down from $245 during 2012. The substantial decrease in parking benefits comes as a result of the expiration of a temporary 'rule of parity.'" (ConnectYourCare)  

Employees Express Views on the Value of Voluntary Workplace Benefits
"More than three-quarters of employees state that the benefits package an employer offers prospective employees is extremely (33 percent) or very (45 percent) important in their decision to accept or reject a job. Nevertheless, 31 percent are only somewhat satisfied with the benefits offered by their current employer, and 26 percent are not satisfied.... Employees identify lower cost (compared with purchasing benefits on their own) and choice as strong advantages of voluntary benefits." (Employee Benefit Research Institute [EBRI])  

Three Reasons COBRA Will Live on After Obamacare
"[1] COBRA participants' carriers may not be offered in some states on the exchanges.... [2] Difficulty finding an in-network doctor... [3] Cost issues ... even with the subsidy." (HR Benefits Alert)  

[Opinion]

Mark McClellan Ran Medicare Part D -- Here's His Advice for the Obama Administration
"Part D's worst trials came when people actually began attempting to use their insurance. Obamacare hasn't even reached that juncture yet -- and, worryingly, its sign-up process has been more troubled and more disruptive than Part D's. Come January there will be people who had their plans canceled by Obamacare but didn't or couldn't sign up for new insurance. There will be people who signed up for new insurance but their application got lost in the tubes. Some of these people will be sick, and interruptions to their care will be dangerous -- not to mention widely publicized. 'There's is a 100 percent chance that this will happen to a nontrivial number of people,' [McClellan said]." (The Washington Post; subscription may be required)  

[Opinion]

Is Obama Legally Authorized to Bail Out the Health Insurers?
"The final rules themselves were only published on October 30. Promising to unravel them only two weeks later is pretty shocking. The black letter of the law states that the government can indemnify only 50 percent of an insurer's costs between 103 percent and 108 percent of target; and 80 percent of costs greater than 108 percent of target. Those figures cannot be fiddled. What can be fiddled are the numerators and denominators that determine whether the ratio of actual to target cost is greater than 108 percent." (John Goodman's Health Policy Blog)  

[Opinion]

Open Enrollment Season Marks the Beginning -- Not the End -- of Exchange Enrollment
"Marketplace enrollment from among the 'flow' population of individuals who become eligible next year -- not just from the 'stock' of currently eligible uninsured and individual plan enrollees -- will be important to meet program enrollment and risk-pool goals.... [M]any of these individuals will be coming from employer-sponsored insurance, and will often become eligible because of their loss of a job.... For many of these individuals, but in particular for young workers -- even for those whose projected annual income is too high to qualify for a tax credit -- marketplace plans will offer much less expensive premiums than continuation coverage under the COBRA program." (Health Affairs Blog)  

Benefits in General; Executive Compensation

[Official Guidance]

Text of NASDAQ Proposal to Amend the Listing Rules on Compensation Committee Composition (PDF)
"Nasdaq proposes to amend Nasdaq Listing Rule 5605(d)(2)(A) and IM-5605-6 to replace the prohibition on the receipt of compensatory fees by compensation committee members with a requirement that a board of directors instead consider the receipt of such fees when determining eligibility for compensation committee membership." (NASDAQ)  

[Guidance Overview]

ISS Issues 2014 Policy Updates (PDF)
"The new methodology for performing the RDA test is to calculate a company's TSR rank and the CEO's total pay rank relative to an ISS-developed peer group solely over a 3-year period (or as many full fiscal years that the company has been publicly traded and disclosed pay data)... The simplification of the RDA Analysis provides a welcomed focus on long-term performance that will not be impacted by the volatility of a single year measure. Generally, the new methodology for conducting the RDA Analysis should be a benign change for most companies." (Meridian Compensation Partners, LLC)  

How Dodd-Frank Has Changed Compensation Practices
"[W]hile some may view the mandated transparency as intrusive, Dodd-Frank's provisions provide an opportunity for forward-looking companies to reveal key aspects of their organizational strategy that translate to competitive advantage. Widespread compliance with these new provisions reveals how competing firms set tones of reasonableness, fairness, accountability and alignment with shareholders' interests." (Corporate Secretary)  

Recent IRS Field Advice Suggests Some Tax Deductions for Bonuses Paid After Year-End May Be at Risk
"According to [IRS Field Attorney Advice (FAA 20134301F)], retaining the unilateral right to eliminate or modify the bonuses at any time prior to payment, per the plan terms, means the company has no legal obligation to pay the bonuses. And because the company has no legal obligation to pay the bonuses and there is no other event fixing the taxpayer's liability, neither of these prongs of the all-events test is satisfied as of year-end. The IRS also found problematic the fact that, after the close of the performance year, the board reviewed the computation of the bonus amounts and had to authorize payments. The problem rested on the IRS conclusion that the board's actions were more than ministerial." (Towers Watson)  

IRS Limits Ability to Deduct Annual Bonus Payments in Year of Accrual, Rather Than Year Paid
"[A]ll employers who sponsor annual bonus plans need to understand the latest changes from the IRS to determine which year is the appropriate year to deduct the amount of their bonus payments. Beyond the timing of the deduction ... [the] impact on deferred tax assets, reporting for uncertain tax positions, and the potential need to apply for an accounting method change with the IRS all need to be examined by employers sponsoring annual bonus plans." (Porter Wright Morris & Arthur LLP)  

[Opinion]

Text of Letter from American Benefits Council to SEC Requesting Extension of 60-Day Comment Period on Proposed Pay Ratio Rules (PDF)
"Our membership has been surprised by the short comment period for this Proposed Rule, partly because the Dodd-Frank Act did not impose a deadline for the issuance of a pay ratio disclosure rule, but more so because the SEC itself has recognized -- repeatedly -- the complex and difficult issues that should factor into identifying a workable regulation. We agree with others that a 60-day extension of the comment period will not necessarily ensure that the Commission will receive the type of information it is requesting. Nevertheless, the absence of an extension will foreclose any possibility for the submission of more comprehensive survey data and thoughtful analysis." (American Benefits Council)  

Press Releases

IRSAC Releases 2013 Annual Report
Internal Revenue Service (IRS)

Legal Benefits Attorney Spotlight: Maura Curran
Hyatt Legal Plans, a MetLife company

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