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Hand-picked links to the web's best news articles,
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[Guidance Overview]
No Imputed Income from After-Tax Purchase of Supplemental and Dependent Life Insurance Through VEBA
"Even when premiums are paid with after-tax dollars, supplemental and dependent life insurance can result in imputed income. This is because the actual premiums paid may be less than IRS table values used to determine the amount of the benefit for tax purposes.... [This private letter] ruling offers an interesting example of how employment-related coverage may avoid that valuation trap. It also sheds light on what is required under Code Section 79 to properly allocate premiums between policies, so they are not automatically aggregated." [IRS Private Letter Ruling 201350032 (Sept. 9, 2013)]
(Thomson Reuters / EBIA)
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[Guidance Overview]
Jan. 9 FAQs Provide Additional Guidance on ACA's Out-of-Pocket Maximum
"The out-of-pocket maximum poses administrative challenges for group health plans that administer [essential health benefits (EHBs)] through multiple vendors. Because the maximum applies to total out-of-pocket costs for all EHBs, separate vendors must coordinate their charges to ensure that enrollees are not charged more than the allowable amount."
(Faegre Baker Daniels)
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Reward-Based Incentives for Smoking Cessation: How a Carrot Became a Stick
"In a randomized controlled trial involving 878 employees, financial incentives worth a total of $750 increased long-term smoking cessation rates from 5.0% to 14.7% at the end of 9 to 12 months.... Examination of the financial returns from implementing a similar program was done by the employer where this trial was performed ... The company's conclusion was that there was a 5-year payback period, consistent with the firm's time frame for other investments. However, simply applying the reward-based incentive program as designed ran into a series of unanticipated road blocks.... [T]he $750 reward eventually became implemented as a $625 surcharge."
(JAMA)
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DOL Issues 2013 Form M-1 Including Instructions and Self-Compliance Tool
"[A]ll plans required to file Form M-1 must file Form 5500 (in other words, plans filing Form M-1 may no longer take advantage of the Form 5500 filing exemption for small unfunded or insured welfare plans).... [A]ll welfare plans filing Form 5500 -- even those not required to file Form M-1 -- are required to attach a 'Form M-1 Compliance Information' statement regarding whether they filed Form M-1 ... While the Form 5500 instructions describe this latter requirement ... nothing on the Form itself (or in the EFAST2 electronic filing system) prompts filers for the attachment."
(Thomson Reuters / EBIA)
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The Ten Most Expensive Health Insurance Markets in the U.S.
"These are the 10 regions of the country with the highest premiums for people buying insurance on the health law's new marketplaces. The ranking is based on the lowest price 'silver' plan, which is the mid-level plan that the majority of consumers are selecting."
(Kaiser Health News)
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In Southwest Georgia, the Affordable Care Act Is Having Trouble Living Up to Its Name
"If Lee Mullins lived in Pittsburgh, he could buy mid-level health coverage for his family for $940 a month. If he lived in Beverly Hills, he would pay $1,405. But Mullins, who builds custom swimming pools, lives in Southwest Georgia. Here, a similar health plan for his family of four costs $2,654 a month.... All the dynamics that drive up health costs have coalesced here in Southwest Georgia, pushing up premiums. Expensive chronic conditions ... One hospital system dominates the area ... Only one insurer is offering policies in the online marketplace and many physicians are not participating, limiting consumer choice."
(Kaiser Health News)
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Viva [FMLA Family Care Leave in] Las Vegas
"[The case of Ballard v. Chicago Park District] highlights the broad nature of FMLA family care leave, particularly in the Seventh Circuit, and sets the stage for other courts to wrangle with these issues in the future. More importantly, however, Ballard reinforces employers' need to assess thoughtfully FMLA leave requests and to revisit their leave policies.... This case creates a circuit split regarding the boundaries of family care leave under the FMLA.In light of Ballard, that boundary has been extended considerably within the Seventh Circuit." [Ballard v. Chicago Park District, No. 13-1445 (7th Cir. Jan. 28, 2014)]
(Littler)
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Devil Is In Details of Final Mental Health Parity Rules Issued in November
"Pre-authorization procedures, plan disclosures and geographical restrictions are just a few features group health plans will need to re-examine by the time the recently finalized mental health parity rules take effect. For calendar-year plans, this means Jan. 1, 2015 -- less than a year away."
(Thompson SmartHR Manager)
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More ACA Regs on the Way in 2014
"More than a dozen rules, ranging from technical to significant, are slated to come out this year or later. That count ... doesn't include several dozen proposed and final rules that were expected during a 12-month period dating back to last July."
(Politico)
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18 Senate Democrats File Brief Outlining Legislative History in Hobby Lobby Contraception Case
"An assortment of senators who were all members of Congress during the passage of both the Religious Freedom Restoration Act of 1993 (RFRA) and the [ACA], have filed an amicus curiae brief detailing the legislative and judicial history leading to the passage of both laws in their support of the U.S. government's position in Sebelius v. Hobby Lobby Stores, Inc., which is now under consideration before the U.S. Supreme Court.... The senators claim that the Tenth Circuit's ruling would result in a situation even more extreme than that envisioned by the authors of the Blunt Amendment, one in which a secular, for-profit company's shareholders could deny employees access to health care services based on the shareholders' religious convictions."
(Wolters Kluwer Law & Business)
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Contractors and HealthCare.gov: Answers to Frequently Asked Questions (PDF)
"Given HealthCare.gov's problematic debut, questions have arisen about how CMS selected vendors to work on HealthCare.gov, and the terms of the vendors' contractual relationships with the government.... The questions in this report are those that happen to have been frequently asked of the Congressional Research Service by congressional staffers."
(Congressional Research Service)
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Anthem to Raise Premiums by as Much as 25% on Some Grandfathered Policies
"Thousands of Anthem Blue Cross individual customers with older insurance policies untouched by Obamacare are getting some jarring news: Their premiums are going up as much as 25%. These increases, 16% on average, are slated to go into effect April 1 for up to 306,000 people -- unless California regulators persuade the state's largest for-profit health insurer to back down."
(Los Angeles Times)
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No Penalties for COBRA Election Notice Failure When Employer Inadvertently Continued Coverage at No Charge
"Leaves of absence present special concerns for COBRA compliance. This employer's difficulties may have started with its continuation of medical plan coverage pending the outcome of the employee's application for LTD benefits. An employer that wishes to extend plan coverage other than through COBRA in such circumstances should [1] make sure its plan documents and insurance coverage so provide, and [2] have a process in place to trigger a COBRA election notice when LTD benefits are denied." [Cole v. Trinity Health Corp., No. C12-3075-MWB (N.D. Iowa 2014)]
(Thomson Reuters / EBIA)
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[Opinion]
Senate Republican Plan to Replace Obamacare Would Raise Taxes -- and That's a Good Thing
"Republican senators Tom Coburn (Okla.), Richard Burr (N.C.), and Orrin Hatch (Utah) proposed on Monday a plan to repeal and replace Obamacare ... [A] new think tank called the Center for Health and Economy provided a fiscal score of the plan. The good news? Over ten years, the Center found that the plan would reduce the deficit by $1.5 trillion. There's only one problem: $1.1 trillion of that deficit reduction comes from curtailing the tax exclusion for employer-sponsored health insurance. But this fact doesn't signal the death of the GOP Senate approach -- but rather its potential."
(Avik Roy in Forbes)
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[Opinion]
The First Amendment and Parsonage Allowances: Why the District Court Is Wrong
"[T]he U.S. District Court for the Western District of Wisconsin, in Freedom from Religion Foundation, Inc. v. Lew, held that Section 107(2) of the Internal Revenue Code violates the First Amendment. Code Section 107(2) excludes from gross income cash housing allowances furnished to 'minister[s] of the gospel.' ... For three, interrelated reasons, the District Court's opinion in FFRF is unpersuasive and should be reversed ... First ... Section 107 has secular purpose and secular effect.... Second, the District Court's FFRF opinion places too much weight on the U.S. Supreme Court's plurality opinion in Texas Monthly, Inc. v. Bullock while giving short shrift to the Supreme Court's earlier opinion in Walz v. Tax Commission.... . Third, the District Court in FFRF accepts the premise of the Texas Monthly plurality that tax exemptions are always subsidies.... In constitutional terms, Section
107 is more convincingly perceived, not as a subsidy, but, per Walz, as managing the inevitable entanglement caused by taxation and as accommodating the autonomy of religious institutions and actors."
(Prof. Edward Zelinsky, OUPblog)
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[Opinion]
Why the SGR Fix Won't Work and Could Actually Make Things Worse
"The SGR fix would basically freeze or severely limit future physician fee updates for Medicare Part B (a serious problem for primary care), while permitting physicians to earn modest 'value-based' bonuses if they can document quality measure attainment, cost reductions, participation in alternative payment schemes, practice enhancement activities, or meaningful use of EHRs.... With this legislation, Congress is preparing yet again to enshrine in statute another payment strategy that is both unproven and highly controversial."
(The Health Care Blog)
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[Opinion]
Wellness Programs: Are Employers Interfering in Employees' Lives?
"What health promotion professionals do advocate is providing theory-based programs designed to make workers more aware of health issues through awareness and education initiatives. These programs help workers develop skills needed to maintain good health ... In contrast, programs that coerce, intimidate, threaten, cajole, bribe, or otherwise undermine individual choices related to health improvement are viewed by workers as self-serving and not in the employees' self-interest. Poorly designed programs do not work. In fact, they often backfire because employees become resentful of management's underhanded methods of compelling individuals to do what they would not otherwise do on their own accord."
(Ron Goetzel in Health Affairs Blog)
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[Opinion]
Time for a Wellness Smackdown
"[In] Canada 'almost two thirds of plan sponsors (those who deliver private health benefit programs) offer at least one wellness program.' However, compared to our employers in the U.S.... Canadian ventures in 'Wellness World' look pretty amateurish.... [W]ellness programs will actually do the exact reverse of what is promised: raise the cost of benefits, squeeze employees' paycheques and send even more employees on the conveyor belt to more screening, more testing and more checkups, resulting in more drugs, more surgeries and more healthcare all round. But it saves the employer money, right? Nope."
(Common Ground)
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Benefits in General; Executive Compensation
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Trends in Realized/Realizable Pay Disclosure by the Top 250 Public Companies (PDF)
"The number of companies providing supplemental realized/realizable compensation tables or charts in their proxy statements more than doubled from 15 of the Top 250 (6%) in 2012 to 37 (15%) in 2013, indicating that disclosure of realized/realizable pay for companies' CEO s and other NEOs is a growing trend."
(Frederic W. Cook & Co., Inc.)
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Press Releases
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