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[Official Guidance]
Text of CMS Operational Guidance on Reinsurance Contributions: Examples of Counting Methods for Contributing Entities
15 pages, August 15, 2015; updated for 2015 benefit year. "The purpose of this document is to provide operational guidance to contributing entities on how to calculate their annual enrollment counts for the purpose of the transitional reinsurance program. [CMS uses] the annual enrollment count to calculate a contributing entity's reinsurance contribution amount due for the applicable benefit year. This operational guidance describes and illustrates each of the counting methods permitted by 45 CFR 153.405."
(Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])
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[Official Guidance]
ACA Information Returns Submission Composition and Reference Guide, August 2015 (PDF)
Version 0.15, dated August 11, 2015; 94 pages. "The purpose of this document is to provide guidance to all types of external transmitters about composing and successfully transmitting compliant submissions to IRS. The audience of this document is ... [1] A business filing their own ACA Information Returns regardless of whether they are required to file electronically (transmit 250 or more of the same type of information return) or volunteer to file electronically.... [2] A third-party sending the electronic information return data directly to the IRS on behalf of any business required to file.... [3] An organization writing either origination or transmission software according to IRS specifications."
(Internal Revenue Service [IRS])
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[Guidance Overview]
ACA Reporting Requirements for Carriers and Employers (Part 6 of 24): Reporting Group Health Plan Opt-Out Arrangements Under Code Section 6055
"Under a common strategy for controlling group health care plan costs, employers sometimes adopt arrangements under which an employee is offered cash as an incentive to waive coverage. These arrangements are colloquially referred to as 'opt-out plans' or 'opt-out arrangements.'... This [article] examines how opt-out credits affect an applicable large employer's determination of affordability for purposes of complying with the Affordable Care Act's (ACA) employer shared responsibility rules, and it explains how opt-out credits are reported."
(Mintz Levin)
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[Guidance Overview]
Retiree HRAs and the ACA: Doing It Right (PDF)
"[E]mployers may want to transition their pre-Medicare retirees to marketplace coverage -- and provide them with financial assistance to help pay for the coverage or to offset some of the cost-sharing burden. Not only may this approach reduce ongoing costs, but it may also help mitigate or eliminate the Cadillac tax on retiree coverage. Employers that want to provide financial assistance through health reimbursement arrangements will need to proceed carefully to avoid potentially unwelcome consequences."
(Buck Consultants at Xerox)
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[Guidance Overview]
Recent Opinion Letter Raises Questions Regarding California's Paid Leave Law
"The Act requires employers who elect the 'no accrual or carry-over' option to provide 24 hours or three days of paid sick leave for employees, and requires the 'full amount of leave' to be provided up front. On August 7, 2015, the Division of Labor Standards Enforcement (DLSE) issued an opinion letter interpreting the statutory language as a minimum labor standard, requiring '24 hours or three days' of paid sick leave, whichever is more for an employee. In other words, '24 hours or three days' must be interpreted as alternative but equally applicable so that either standard would not undercut sick leave for any employee."
(Ford & Harrison LLP)
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Mental Health Parity Ruling Called 'Watershed Case'
"Robert Rachal, a senior counsel at Proskauer Rose in New Orleans ... said the decision 'will make it easier for participants and medical providers with valid assignments to enforce claims for benefits.' However, Rachal cautioned, 'I think it is too soon to tell whether associations will be able to bring systematic claims seeking to change how insurers process mental health benefits.' ... 'The key thing to understand is the incredible power that the third-party administrators have in the market here,' [said Jason S. Cowart, a partner at Zuckerman Spaeder]. 'They have all the discretion when it comes to approving or denying benefit claims.' "
(Bloomberg BNA)
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How Many Employers Could Be Affected by the Cadillac Tax?
"Looking first at the expected costs for just plan premiums plus employer contribution to HSAs and HRAs, we estimate that about 16 percent of employers offering health benefits would have at least one health plan that would exceed the $10,200 HCPT self-only threshold in 2018, the first year that plans are subject to the tax. The percentage would increase to 22 percent in 2023 and to 36 percent in 2028.... These percentages rise significantly when we consider the impact that FSA options can have: up to 26 percent in 2018, 30 percent in 2023 and 42 percent in 2028[.]"
(Henry J. Kaiser Family Foundation)
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Private Exchanges Leading to Both a 'Buy-Down' and a 'Buy-Up' Effect
"One interesting result of the advent of private exchange technology combined with a defined contribution is that when individuals are given [1] money to spend on benefit purchases and [2] a shopping experience that they can navigate, they behave like consumers. In this environment, they typically purchase less medical coverage (sometimes called the 'buy-down' effect), leaving money available to purchase other benefit options (the 'buy-up' of voluntary benefits).... As a result of this change in buying habits ... the Willis Private Exchange experience has demonstrated savings of almost $700 per employee per year."
(The Institute for HealthCare Consumerism [IHCC])
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Investment Options and HSAs: Findings from the EBRI HSA Database (PDF)
11 pages. "In 2014, 6.4 percent of health savings account (HSA) owners in the EBRI HSA Database had used the investment option portion of the account. Forty-seven percent of the HSAs with investments were opened between 2005 and 2008, compared with 8 percent among HSAs without investments.... Individuals contributed $2,636 annually on average when they had investments and $1,224 when they did not have investments. Annual distributions for health care claims averaged $1,777 from HSAs with investments, and $1,293 from HSAs without investments. End-of-year account balances averaged $10,261 among HSAs with investments, and $1,709 in HSAs without them."
(Employee Benefit Research Institute [EBRI])
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How Much Does It Cost? Tools Empowering Consumers with Healthcare Provider Price Information
"As a result of the increased recognition of the value of price transparency in informing consumer decision-making and promoting efficient, quality care, health plans, as well as the federal and state governments, have taken steps to increase the availability of price information for health care services and promote its use in consumer decision-making. While several factors continue to present challenges to greater transparency of price information, opportunities exist to advance price transparency in the public and private sectors in a way that helps ensure consumers have usable data and access to care."
(America's Health Insurance Plans [AHIP])
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[Opinion]
What Can Go Wrong with a Private Health Insurance Exchange?
"Like the Obamacare exchanges, health plans in private exchanges don't add to their bottom line by becoming good at cancer care, diabetic care or at any other expensive-to-treat disease.... So what can be done? ... [H]ave all the health plans be offered by a single insurer, say, Blue Cross.... [M]anaged competition only works when health plans are prevented from doing what is in their self-interest to do.... [E]mployer risk adjustment.... [H]ave the risk adjustment be administered by the health plans themselves."
(John Goodman, in Forbes)
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Benefits in General; Executive Compensation
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Third Circuit Opinion: District Court's Order Remanding to Plan Administrator Was Not Appealable (PDF)
"Santander and Liberty Mutual appealed to this Court, but Stevens moved to dismiss the appeal for lack of jurisdiction, arguing that the District Court's remand order to the plan administrator was not a 'final decision' appealable pursuant to 28 U.S.C. Section 1291 at that time. Before reaching the merits of this appeal, we must determine whether the District Court's remand order is presently final and appealable under Section 1291 or is otherwise appealable. Upon review, we hold that the District Court has retained jurisdiction over the case and that the order from which appellants have appealed is not yet appealable. We therefore will dismiss this appeal for lack of jurisdiction." [Stevens v. Santander Holdings USA Inc. Self Insured Short Term Disability Plan, No. 14-1481 (3d Cir. Aug. 24, 2015)]
(U.S. Court of Appeals for the Third Circuit)
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Performing Quality ERISA Employee Benefit Plan Audits: Firm Best Practices (PDF)
32 pages. "This tool is designed to be used by all firms that perform EBP audits, whether your firm performs just a few EBP audits or has (or is considering developing) a specialized EBP audit practice. This tool provides tips for establishing effective quality control policies and procedures specific to your EBP audit practice; provides examples of best practices for each phase of the audit engagement, including a suggested timeline for implementation; and provides links to useful tools and resources[.]"
(American Institute of Certified Public Accountants [AICPA])
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No Social Security COLA Causes Medicare Flap
"In 2016, for only the third time in 40 years, Social Security beneficiaries are not expected to receive a cost-of-living adjustment (COLA). No COLA means that Medicare Part B premiums cannot increase for most beneficiaries, so a minority has to bear the full burden of rising costs. Beyond this immediate flap, a broader issue is that Medicare premium growth is not fully captured by the inflation measure used to set the COLA. As a result, when Medicare premiums rise rapidly, older Americans cannot maintain their non-Medicare spending. In short, even the Social Security COLA does not fully insulate older households from the erosive impact of inflation."
(Center for Retirement Research at Boston College)
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