ACA Reporting Penalties Significantly Increased
"[A chart summarizes] a few of the notable penalty changes made by the Act.... [T]he final ACA regulations provide that penalties will not be imposed on entities that show they made good faith efforts to comply with the reporting requirements for 2015. The IRS has indicated that an untimely filed form will not meet the good faith requirement. Should the requirements regarding ACA reporting not be met due to good faith requirements, the penalties may be still be waived if the failure was due to reasonable cause."
(McDermott Will & Emery)
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Health Coverage Tax Credit Adds One More Consideration for Employers
"[T]he Health Coverage Tax Credit (HCTC) ... [had] expired at the end of 2013 and even though prior to its expiration it was not widely used, the reinstatement is one more consideration for employers to tackle in what seems to be an unending list. The legislation pays 72.5% of healthcare premiums for eligible beneficiaries -- employees who have lost jobs due to foreign competition or worked for companies whose pension plans failed. This applies to COBRA which means that employers should begin to think about adding language about the HCTC into COBRA notices."
(Frenkel Benefits)
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Paid Sick Leave Began on July 1 for Employees in Massachusetts and California
"In Massachusetts, employers must now provide all employees with five days of sick leave per year, paid or unpaid depending on the employer's size. California employers, on the other hand, must now provide employees at least three paid sick days per year. Employers that already provide paid time off, vacation, or other leave benefits can potentially use existing policies to meet their new compliance obligations as long as it meets the minimum requirements of the new law."
(William Gallagher Associates)
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Health Care Tax Faces United Opposition from Labor and Employers
"A new coalition comprising major corporations, including Cigna and Pfizer, as well as union groups and associations ... plans to begin a formal campaign against the tax later this month.... About two-thirds of employers recently surveyed ... estimate they will have at least one health plan that will be taxed within five years, and three-quarters think the majority of their plans will be subject to the tax after 2028."
(The New York Times; subscription may be required)
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Health Spending: The $2 Trillion Question -- or Questions
"The slowdown in U.S. health care spending over the past several years has been the focus of intense debate. A lot is at stake: the $2 trillion in the title of this piece refers to the difference between aggregate national health expenditures for 2010 through 2019 as projected in March 2010 and the total ... expected over that same period. Much of the debate on this issue has been centered on three questions: What has caused this slowdown? Is it really a change? Will it continue?"
(Health Affairs)
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The Case for Lowering Medicare Eligibility to Age 50
"[T]he argument that the federal government could save money in the long-term by raising Medicare's age of eligibility only two years, and not until 2017, is highly dubious.... [S]ome evidence suggests that lowering the eligibility age and bringing seniors on to Medicare sooner would be good medicine for many people, including taxpayers.... Bringing robust preventive coverage to those over 50 could help prevent expensive diseases and health interventions later on in people's lives, potentially saving Medicare in the long-term.... Medicare coverage at 50 would be a major incentive to move the rest of the U.S. healthcare system into the prevention paradigm[.]"
(Healthcare Payer News)
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Anthem Announces It Will Buy Cigna to Create New Health Insurance Giant
"A merged company would serve 53 million people and is part of a dramatic, long-predicted reshaping of the health insurance landscape as a result of the Affordable Care Act. UnitedHealthcare has 45 million members, and Humana and Aetna announced they would merge in July, creating a company serving 33 million people. The new company is projected to generate $115 billion in annual revenues."
(The Washington Post; subscription may be required)
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Anthem to Buy Cigna -- and Then There Were Three
"While not yet a single-payer system, consolidation is causing the system to look more like a small oligarchy.... The consolidation is quite frightening for smaller providers of all sorts as it leaves them with fewer access points for patients. The leverage of providers with payers will take a significant hit.... The consolidation is unlikely to reduce employer costs or really bend the cost curve[.]"
(Becker's Hospital Review)
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[Opinion]
What the 'Cadillac Tax' Accomplishes -- And What Could Be Lost in Repeal
"Repealing the Cadillac tax would be a significant setback to efforts to curtail tax breaks and other policies that, while popular, encourage overuse of the health-care system or favor inefficient health-care providers. Tweaking or replacing the tax with an alternative that accomplishes the same goals is a possibility, though finding one that would raise as much money will be hard. Abandoning it would be a worrisome sign that political timidity dooms almost any policy to slow the growth of health-care spending."
(The Brookings Institution)
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Benefits in General; Executive Compensation
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[Guidance Overview]
SEC Proposes Rules for Compensation Clawback Policies
"The proposed rules are a good opportunity to think about whether existing policies sync with the proposed rules on the following key terms: Are the correct 'executive officers' included under the policy? Is 'incentive-based compensation' properly understood under the policy? What types of, and how much, incentive-based compensation must be clawed back? Are there any exceptions? What types of clawback terms should be included in employment agreements?"
(Porter Wright Morris & Arthur LLP)
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Potential Erosion of the Distinction Between Benefits Denials and Breach of Fiduciary Duty Under ERISA in the Tenth Circuit
"The Tenth Circuit has historically disallowed a participant's or beneficiary's claim for breach of fiduciary duty pursuant to Section 502(a)(3) when ERISA provides for another adequate remedy, such as recovery of improperly denied benefits pursuant to Section 502(a)(1)(B).... In [one recent case], however, the district court allowed a plan participant to amend his complaint to include a breach of fiduciary duty based on the claim fiduciary's alleged failure to consider an expert report that was submitted just one day before its final decision denying benefits was issued ... the claim fiduciary argued it was futile given that the breach of fiduciary duty claim was based on a wrongful denial of benefits, and therefore subject to dismissal. The district court allowed the amendment, reasoning that the breach of fiduciary duty cause of action could be asserted as an alternative claim for
relief." [Faltermeier v. Aetna Life Ins. Co., No. 15-CV-2255-JAR-TJJ (D. Kan. May 28, 2015)]
(Wilson Elser)
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Tips to Reduce Adverse Effects of DOL's New Independent Contractor Status
"Check your ERISA plan language to ensure a misclassification issue does not result in the application of benefits if the worker is later determined to be an employee.... Excluding 'independent contractors' in the plan means the misclassified employee is now subject to benefits."
(Holland & Knight)
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Employee Benefits in the United States, March 2015 (PDF)
"Retirement benefits were available to 66 percent of private industry workers in the United States in March 2015 ... Employer-provided retirement benefits were available to 31 per cent of private industry workers in the lowest wage category (the 10th percentile). By contrast 88 percent of workers in the highest wage category (the 90th percentile) had access to retirement benefits.... The share of premiums workers were required to pay for their medical coverage varied by bargaining status. Private industry nonunion workers were responsible for 23 percent of the total single coverage medical premium, whereas the share of premiums for union workers was 13 percent."
(U.S. Bureau of Labor Statistics [BLS])
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[Opinion]
Can We Stop Pretending That the Trustees Reports Are Good News?
"[W]hile it is true that the Retirement benefits portion of OASDI (the OAS part) took in more revenue than it paid in benefits last year and has a 'trust fund' of $2.7 trillion, that fund will be exhausted in 2035... [O]ver 75 years, the unfunded obligations for OASDI are $10.7 trillion.... This does not even count the rapidly growing Medicare program ... More can be done to reform many parts of the program while keeping benefits for those who truly need them, from the application process to benefit determination[.]"
(National Center for Policy Analysis [NCPA])
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Press Releases
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