Health & Welfare Plans Newsletter

September 19, 2014

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Part Time On Call Retirement Planning Consultant
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Webcasts and Conferences

Conducting and Updating HIPAA Risk Assessments: Essential Steps for Employer Plans and Business Associates
September 18, 2014 WEBCAST
(Thomson Reuters / EBIA)

Committee on Benefits Finance Meeting
September 22, 2014 in DC
(Financial Executives International)

At Long Last! IRS Clarifies Rollover Options for After-Tax Savings
September 24, 2014 WEBCAST
(Convergent Retirement Plan Solutions, LLC)

Cash Balance Design and Strategies
October 7, 2014 WEBCAST
(Sherman & Howard L.L.C.)

Transparency in Quality Data, Pricing, and Medical Records
October 7, 2014 in MA
(NEJM Group)

View All Webcasts and Conferences



[Official Guidance]

Text of CCIIO Guidance: Shared Responsibility Guidance -- Filing Threshold Hardship Exemption (PDF)
"[A]ll individuals with gross income below the filing threshold are entitled to a hardship exemption regardless of whether they file a return and regardless of whether they claim a dependent. Pursuant to this guidance, this exemption may be claimed through the tax filing process, but individuals who are eligible for this exemption and do not file tax returns will be exempt without having to take any further action. If an individual qualifies for this exemption, the exemption applies to the individual, the individual's spouse (if filing jointly or if no return is filed), and any one the individual claims or could have claimed as a dependent." (Center for Consumer Information and Insurance Oversight [CCIIO], Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  


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[Guidance Overview]

California's Paid Sick Leave Law: No Get Well Card for Employers
"The law excludes only four categories of employees. First, it exempts employees covered by a collective bargaining agreement expressly providing for employees' wages, hours and working conditions; premium overtime wage rates; hourly pay at least 30 percent above the state minimum wage; and 'expressly provides for paid sick days or a paid time off policy that permits the use of sick days.' ... Second, the law has another collective bargaining exemption for the construction industry.... The other exceptions are for employees under the state' s In-Home Supportive Services program and certain airline flight deck or cabin crew members." (Nixon Peabody LLP)  

[Guidance Overview]

Massachusetts Now Requires Employers of 50 or More Employees to Provide Domestic Violence Leave
"The law does leave a few aspects up to the employer's discretion. First, the employer has the sole discretion to determine if domestic violence leave will be paid or unpaid, assuming it is applied in a nondiscriminatory matter. Second, the employer decides whether an employee must take all available paid time off (i.e., sick, personal, and vacation days) before requesting domestic violence leave. And, third, the employer decides if it will require an employee to provide documentation substantiating the need for leave under this new law." (Epstein Becker Green)  

Delays at CMS May Make It Difficult for Health Plan Sponsors to Obtain an HPID on Time
"After an authorized individual of the plan sponsor registers on the CMS Enterprise Portal, the authorized individual must 'request access' to [the Health Insurance Oversight System (HIOS)]. CMS must individually grant access to HIOS by electronically sending the authorized individual an authorization code. After access is requested, an automatically generated message indicates that CMS will typically respond to the request within 24 hours. Unfortunately, it is taking CMS significantly longer than 24 hours to grant access to HIOS." (Miller Johnson)  

Health Care Survey of Employers: Changes Ahead in 2015
"Employers estimate that 2015 health care costs will increase by 4% after changes to medical and pharmacy plan designs, vendors, provider networks or other features. Eight in 10 companies (81%) plan to make moderate to significant changes to health benefit programs for full-time active workers. Two-thirds of CEOs and CFOs will be more directly involved in health care strategy decisions than they were three to five years ago to help control costs and reduce exposure to the 2018 excise tax." (Towers Watson)  

Employee Choice in the SHOP Marketplace
"To date, the majority of state-based SHOP Marketplaces have chosen to implement employee choice, but federal regulations have made implementation of employee choice voluntary until 2016.... While a majority of small businesses say they are interested in giving employees more plan choices, detractors have raised concerns that employee choice may overwhelm employees with too many choices or result in higher premiums in the SHOP if higher-risk employees can select more comprehensive plans than lower-risk employees." (Health Affairs)  

An Update on the Small Business Health Options Program: Is It Working for Small Businesses?
"On Thursday, September 18, 2014, ... the Committee on Small Business Subcommittee on Health and Technology held a hearing titled, An Update on the Small Business Health Options Program: Is It Working for Small Businesses?' ... The purpose of the hearing was to examine the current state of the SHOPs and whether they are working for small businesses." [Page includes links to testimony by [1] Mayra Alvarez, Director State Exchange Group, Center for Consumer Information and Insurance Oversight, CMS; [2] Dr. Roger Stark, Health Care Policy Analyst, Washington Policy Center; [3] Adam Beck, Assistant Professor of Health Insurance, The American College of Financial Services; and [4] Jon Gabel, Senior Fellow, NORC, University of Chicago.] (Committee on Small Business, U.S. House of Representatives)  

Non-Partisan Panel Urges Overhauling Health Care at End of Life
"The country's system for handling end-of-life care is largely broken and should be overhauled at almost every level, a national panel [appointed by the Institute of Medicine, the independent research arm of the National Academy of Sciences,] concluded ... Many of the report's recommendations could be accomplished without legislation. For example, the panel urged insurers to reimburse health care providers for conversations with patients on advance care planning.... But some recommendations -- like changing the reimbursement structure so that Medicare would pay for home health services instead of emphasizing hospital care, and so that Medicaid would provide better coverage of long-term care for the frail elderly -- would require congressional action." (The New York Times; subscription may be required)  

Why the Geographic Variation in Health Care Spending Can't Tell Us Much About the Efficiency or Quality of Our Health Care System
"This paper examines the geographic variation in Medicare and non-Medicare health spending and finds little support for the view that most of the variation is likely attributable to differences in practice styles.... More broadly, the paper shows that the geographic variation in health spending does not provide a useful way to examine the inefficiencies of our health system. States where Medicare spending is high are very different in multiple dimensions from states where Medicare spending is low, and thus it is difficult to isolate the effects of differences in health spending intensity from the effects of the differences in the underlying state characteristics." (The Brookings Institution)  

ERISA at 40: ERISA, Nixon, and the Could-Have-Been ACA (PDF)
"This article looks at the Nixon administration's proposal to reform the US health care system, presented to Congress in 1974 -- the same year ERISA was enacted. Although it wasn't adopted, the proposal included a number of provisions that are surprisingly similar to those appearing in the Affordable Care Act." (Buck Consultants at Xerox)  

ACA Is Erasing the Difference Between Hospitals and Insurers
"Most hospitals currently make more money performing a surgery than providing preventive care to avoid one, but under the Affordable Care Act they're being encouraged to change that: Instead of compensating doctors and hospitals for each service provided, the law encourages arrangements that reward hospitals for better outcomes. Some health-care providers have responded by consolidating." (Bloomberg Businessweek)  

Plan Selections by Zip Code in the Health Insurance Marketplace
"The dataset provides the total number of Qualified Health Plan selections by ZIP Code for the 36 states that are participating in the Federally-facilitated Marketplace, or have State Partnership Marketplaces or supported State-based Marketplaces, for the initial Marketplace open enrollment period from October 1, 2013 through March 31, 2014, including additional special enrollment period activity reported through April 19, 2014. The data represent the number of unique individuals who have been determined eligible to enroll in a Marketplace plan and had selected a plan by April 19." (Assistant Secretary for Planning and Evaluation [ASPE], U.S. Department of Health and Human Services [HHS])  

[Opinion]

Reference Pricing and Network Adequacy Standards: Conflict or Concord?
"[R]ecent federal guidance ... blurs the distinction between in-network and out-of-network providers and may make it more difficult for regulators and consumers to understand the effective 'size' of a particular network. This confusion could undermine the goal of improving transparency in consumers' health care choices and make it difficult for consumers to use prices in choosing providers. More troubling, expanded use of 'reference pricing' under the guidance could leave patients paying unexpectedly large out-of-pocket amounts for services provided by ostensibly in-network providers." (Health Affairs)  

[Opinion]

Number of Uninsured Americans Aged 18-64 Drops by Two Percentage Points
"The number of uninsured Americans aged 18-64 has dropped by two percentage points from the first quarter of 2013 to the first quarter of this year ... [T]hat brings the proportion of uninsured down to where it was about ten years ago.... Obamacare has not managed to overcome the results of the recession that began in December 2007." (National Center for Policy Analysis Health Policy Blog)  

Benefits in General; Executive Compensation

[Official Guidance]

Text of IRS Final Regs: Deduction Limitation for Remuneration Provided by Certain Health Insurance Providers
"This document contains final regulations on the application of the $500,000 deduction limitation for remuneration provided by certain health insurance providers under section 162(m)(6) of the Internal Revenue Code ... These regulations affect certain health insurance providers providing remuneration that exceeds the deduction limitation[.]" (Internal Revenue Service [IRS])  

[Official Guidance]

Text of IRS Notice 2014-57: Special Per Diem Rates (PDF)
"This annual notice provides the 2014-2015 special per diem rates for taxpayers to use in substantiating the amount of ordinary and necessary business expenses incurred while traveling away from home, specifically [1] the special transportation industry meal and incidental expenses (M&IE) rates, [2] the rate for the incidental expenses only deduction, and [3] the rates and list of high-cost localities for purposes of the high-low substantiation method." (Internal Revenue Service [IRS])  

Employee Classification: An Old Issue Getting Renewed Attention (PDF)
"Worker classification analysis requires a proper assessment of facts and circumstances. For many years, employers have often reached the wrong conclusion, whether or not intentionally. When left unchallenged, a decision to treat a person who should be characterized as an employee as an independent contractor costs the federal and state governments a good deal in uncollected taxes and other social charges, especially when the independent contractors don' t properly report their earnings. For an employer that is challenged on its classification practices and loses, the cost of correction can be significant." (Debevoise & Plimpton LLP)  

Second Circuit Makes It Tough to Appeal District Court's ERISA Remand Order
"Issue: Whether an order remanding the claim to the ERISA administrator constitutes a 'final decision' from which an appeal may be taken? 2nd Circuit held: NO.... Remand decisions are not 'immediately appealable.'... [The court said,] 'Taking into consideration our prior case law and the various analytical approaches used by our sister circuits, we now hold that remands to ERISA plan administrators are not ' final' because in the ordinary case, they contemplate further proceedings by the plan administrator.... We decline, however, to adopt a hard and fast rule that such orders are never immediately appealable[.]'" [Mead v. Reliastar Life Insurance Company, No. 11-192-cv (2d Cir. Sept. 16, 2014)] (Lane Powell PC)  

Communication During Open Season Fraught With Inconsistency, High Potential for Liability
"[N]otices meant to be provided by ERISA plan administrators should be sent by the party that is the plan's named administrator, which may or may not be the employer ... Notices required under [ERISA] should not contain discussions of non-ERISA voluntary benefits ... The consequence of blurring the lines between fiduciary and non-fiduciary -- ERISA and non-ERISA -- is that the communication may be used in litigation or on audit as evidence establishing that the non-fiduciary is actually a fiduciary and/or the non-ERISA benefit is actually governed by ERISA." (Bloomberg BNA)  

Press Releases

NAGDCA Elects 2014-2015 Executive Board
National Association of Government Defined Contribution Administrators

FINRA Marks 75th Anniversary of Protecting Investors
Financial Industry Regulatory Authority [FINRA]

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