Health & Welfare Plans Newsletter

January 16, 2015

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Employee Benefits Jobs

Sr Specialist/ Recordkeeping - Defined Benefit Plan Operations
Charles Schwab
in OH

Defined Benefit Client Services Manager
Charles Schwab
in OH

Pension Administrator
Actuaries Unlimited, Inc.
in CA

401(k) Sales Specialist - Institutional Investments
PNC
in PA

Internal Sales Consultant
United Retirement Plan Consultants
in OH

Retirement Plan Administrator
IRC
in OR

Vice President, National Accounts
United Retirement Plan Consultants
in OH

Regional Sales Consultants
United Retirement Plan Consultants
in CA, DC, MD, OR, WA

Benefits Associate
Ogletree Deakins
in IL

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Webcasts and Conferences

Legislative Update: Health & Welfare Benefit Plans
January 29, 2015 WEBCAST
(TRI-AD)

Trustees and Administrators Institutes
February 9, 2015 in FL
(International Foundation of Employee Benefit Plans [IFEBP])

PBM Contracts: Innovative Strategies to Improve Your Plan’s Bottom Line
February 12, 2015 WEBCAST
(Atlantic Information Services, Inc.)

SEC Exam Priorities for 2015
February 17, 2015 WEBCAST
(Regulatory Compliance, LLC )

Annual Qualified Health Plan Certification Conference
February 23, 2015 in MD
(Centers for Medicare & Medicaid Services [CMS])

East Coast Defined Contribution Conference
March 1, 2015 in FL
(Pensions & Investments)

Mid-Sized Retirement & Healthcare Plan Management Conference
March 8, 2015 in CA
(University Conference Services)

View All Webcasts and Conferences



[Guidance Overview]

CMS Presentation Slides: FF-SHOP Updates, January 13, 2015 (PDF)
28 presentation slides. "Purpose: [1] Provide FF-SHOP issuers with updates and announcements; [2] Review SHOP Maintenance Reason Codes; [3] Provide an overview of Increment 3 development; [4] Provide an overview of 2015 SHOP development enhancements[.]" (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  


[Advert.]

Looking to Connect with other EB Professionals? Start a New WEB Chapter!

Sponsored by WEB - Worldwide Employee Benefits Network

Are you are a leader in employee benefits? Interested in developing qualifications of others in the field, while enhancing your own credentials? Contact us about joining a team of like-minded professionals to start a new WEB chapter in your geographic area.



[Guidance Overview]

How Contributing to a Multiemployer Plan Protects an Employer from the ACA's Employer Shared Responsibility Penalty
"The multiemployer rule protects the employer with respect to its employees for whom it has signed a CBA or participation agreement, but it does not change the employer's responsibilities to provide coverage to other employees or pay the penalty.... Any penalty that is owed would be paid by the contributing employer, not by the plan, based on the employer's total workforce (bargained or not)." (Segal Consulting)  

[Guidance Overview]

Identifying Full-Time Employees Under the ACA's Employer Shared Responsibility Penalty
"This [article] reviews detailed guidance from the Treasury Department and the [IRS] on how employers will determine whether an employee is a full-time employee for purposes of the employer penalty.... It concludes with a list of action steps.... Identify all common-law employees not currently being offered health coverage and determine whether any of them might be full-time employees under the [ACA].... Decide how to measure employees.... If using the look-back measurement method, determine the measurement, administrative and stability periods for ongoing employees [and] new part-time, variable hour, and seasonal employees ... Establish policies for crediting hours of service ... Address implementation of measurement methods[.]" (Segal Consulting)  

[Guidance Overview]

Employer Offer of Healthcare Coverage: The Multiemployer Plan Problem
"[T]he interim guidance now provides that an employer is treated as offering coverage for all employees for whom it is required to contribute to the multiemployer plan, even those full-time employees who never satisfy that plan's eligibility rules and therefore are never offered coverage. So employers who are making contributions to the plan (who arguably never have control over the plan's eligibility rules) are protected as long as they are making contributions. The fact that the plan may not actually provide coverage does not mean the employer has failed to offer the coverage." (Fox Rothschild LLP)  

[Guidance Overview]

Immediate Action Required for Employers Who Provided Transit Benefits to Employees in 2014
"For employers with transit programs, ... amounts paid or reimbursed for qualified transit benefits above $130 in 2014, up to $250 per month, are now being treated as non-taxable. This has two primary effects: it (i) reduces FICA taxes due, and (ii) requires employers to revise the Forms W-2 for affected employees.... [E]mployees may not retroactively increase their monthly transit benefit elections for 2014 in response to the law change." (Dorsey & Whitney LLP)  


[Advert.]

On-Site Employee Health Clinics Summit – Mar 11-12 2015 – Atlanta

Sponsored by World Congress

Case studies and strategies from innovative employers to leverage on-site clinics to drive down health costs and increase employee health care accountability through quality care in a convenient setting.



[Guidance Overview]

Rules Proposed for Paid Sick Leave Ordinance in Eugene, Oregon
"The ordinance applies to businesses based both inside and outside of the city of Eugene. It operates not on an employer's location, but rather on where an employee performs work, even if that location changes from day to day. Under the ordinance, any employee performing work within Eugene must accrue paid sick leave. Accordingly, employees who occasionally travel into Eugene to make deliveries or visit customers, for example, may be entitled to paid sick leave." (Ogletree Deakins)  

No End in Sight for Wave of Paid Family and Sick Leave Laws
"A major problem with the proposed [Healthy Families Act] from an employer standpoint is that it would not supersede or preempt the multitude of state and local laws with more generous paid sick leave laws. Its passage would thus result in even more complex sick leave policies, as employers will need to sift through the differences between and among state and local laws and the federal law to ensure that employees are receiving the benefit of the most generous law. Some local laws provide for a higher amount of possible leave." (Proskauer's Law and the Workplace)  

Immediate Action Required to Maximize Tax Savings for Mass Transit Benefits
"Congress and the IRS have expanded the availability and procedures for maximizing the income tax and FICA tax exclusion for mass transit benefits, but immediate action is required to satisfy the IRS special relief provisions for 2014 as well as to qualify for the anticipated expansion of the maximum 2015 tax benefits for the mass transit component of qualified transportation fringe benefits.... To the extent that any employer is currently using a cash reimbursement program for mass transit benefits, that program must be discontinued by the end of 2015. If not, the cash reimbursements will be fully taxable for both income tax and employment tax purposes." (Morgan Lewis)  

CMS Administrator Marilyn Tavenner Stepping Down
"A senior government official with almost unparalleled authority over the U.S. health care system is stepping down, ending a tenure that included one highly publicized, highly consequential failure on Obamacare as well as significant, if less heralded, successes. Marilyn Tavenner will resign as administrator of the Centers for Medicare and Medicaid Services, effective at the end of February ... Andrew Slavitt, the agency's second-ranking official, will take over in an acting capacity." (The Huffington Post)  

Accounting for the ACA Transitional Reinsurance Fee
"Plans should recognize the entire liability for the calendar year on or shortly after January 1 of that year. When the entire liability is booked, the offsetting entry is to a Deferred Charge (an asset). The liability goes away when the fee is paid and the Deferred Charge is amortized ratably over the 12 months of the year. In a normal year, the fee will be due and payable in September.... 2014 is not a 'normal' year.... Plans had until December 5 to enter data onto the website." (Bond Beebe Accountants & Advisors)  

New ACA Court Challenge Could Come from Ohio
"The [state of Ohio and Warren county] are self-insured, although they retain outside companies to administer their plans.... [Self-insured] local and state governments must find ways to offset the payments to the ACA reinsurance fund or else pass the costs on to taxpayers.... The legal issue here: The transitional reinsurance fee amounts to a tax, according to [Ohio Attorney General Mike DeWine], and to [Warren county commission Chairman David Young]. And the thing is, they say, the federal government may not tax a different domestic government." (Cleveland Plain Dealer)  

Half of Large Employers Are Unprepared to Fully Comply with ACA
"While the majority of large employers (70%) handle ACA compliance internally, the study revealed that these employers do not feel fully prepared to manage several critical compliance requirements, including Exchange notices (62%), ACA penalties (60%) and annual health care reporting (IRS Forms 1094/1095-C) (49%)." (ADP)  

The Other Debt Bomb in Public Employee Benefits: Retiree Healthcare Liabilities
"Unlike pension plans, governments are not required to contribute to separate trusts to support health-care promises. As a result, only 11 states have funded more than 10% of retiree health-care liabilities ... New Jersey has almost no assets backing one of the largest retiree health-care liabilities of any state -- $63.8 billion. Only eight out of the 30 largest U.S. cities have funded more than 5% of their retiree health-care obligations ... New York City tops the list with $22,857 of unfunded liabilities per household." (The Wall Street Journal; subscription may be required)  

Study Disputes Perception That New Beneficiaries Are Fueling Medicare Advantage Growth
"The majority of people who signed up for Medicare Advantage plans in recent years were switching out of the traditional Medicare program, according to a recent study. The findings contradict the popular belief that growth in Medicare Advantage has been fueled primarily by people who choose it when they first become eligible for Medicare.... Beneficiaries in their mid- to late-60s made up the largest share of those who switched from traditional Medicare to Medicare Advantage[.]" (Kaiser Health News)  

Obama Cybersecurity Plan Could Change Healthcare Processes
"The legislation if enacted would establish a national standard for 'companies' to notify affected individuals of a breach 30 days from discovery of the breach. Assuming that healthcare covered entities and business associates would be considered 'companies,' that would mean the current HIPAA standard of notifying patients of a breach no later than 60 days after discovery would be preempted." (Employee Benefit News)  

[Opinion]

Single-Payer System Would Free $375 Billion for Health Care
"A new study has put a price tag on how much more the United States pays in health care costs because it has chosen not to adopt a single-payer system: $375 billion. That figure, in a report published this week in the online journal BMC Health Services Research, represents the excess administrative costs imposed by our private billing and insurance system in 2012. It would have been enough, the report said, to provide every uninsured American with health coverage and upgrade coverage for millions of others who are carrying inadequate, bare-bones policies." (Physicians for a National Health Program [PNHP])  

[Opinion]

Obama Pushes for Paid Sick Leave; What Is the Impact on Employers?
"Employers, let's not breathe a sigh of relief that we've dodged yet another federally-mandated employment statute or regulation. As we have witnessed over the past few years, due to the inactivity on this issue at the federal level, a growing number of states and local governments will continue to pass their own versions of paid sick leave.... [T]he President is taking the message to the local level, urging states and cities to pass such laws on their own. And he's putting money behind the effort." (FMLA Insights)  

Benefits in General; Executive Compensation

Dallas Salisbury to Step Down as EBRI Chief
"When Mr. Salisbury, then just 29, joined EBRI [in 1978] after holding various positions at the PBGC and the departments of Labor and Justice, corporate defined benefit plans were growing instead of shrinking, 401(k) plans had yet to be launched, 'derisking' was not yet part of the pension lexicon, and COBRA referred to an animal, not an acronym for the 1986 federal health-care continuation law.... 'Washington is full of institutions that lobby government; Dallas created one that educates the nation,' said former PBGC Director Joshua Gotbaum." (Pensions & Investments)  

Recent Case Imposing Employer Liability Based on FICA Error May Extend to 409A Errors (PDF)
"For employers sponsoring nonqualified plans, the recent Henkel decision does offer some potentially helpful guidance regarding FICA withholding and the Code's special timing rule. Specifically, the court indicated in its opinion that if an employer fails to withhold FICA taxes on nonqualified plan benefits consistent with the special timing rule, withholding of the FICA taxes on a 'pay as you go' basis complies with federal law." [Davidson v. Henkel Corp., No. 12-cv-14103 (E.D. Mich. Jan. 6, 2015)] (Groom Law Group)  

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